SINGAPORE: Dalian iron ore futures traded flat on Monday as traders weighed the easing supply concerns and lagging steel demand against improving market sentiment in top consumer China.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) held steady, ending morning trade at 799.5 yuan ($109.29) a metric ton.
The benchmark February iron ore on the Singapore Exchange was 0.44% lower at $103.4 a ton.
Australia’s Port Hedland, the world’s largest iron ore export hub, has resumed operations after cyclone Sean moved away from the port, the Pilbara Ports Authority said.
The port was closed on Saturday night over threat from the cyclone.
Steel inventory is low and the demand for raw material replenishment is also similarly low, Chinese consultancy Galaxy Futures said.
The decline in demand for steel in real estate is expected to narrow, Galaxy Futures added.
The total investment in Chinese real estate development fell in 2024, decreasing 10.6% from 2023, Chinese consultancy Lange Steel said, referencing data from the National Bureau of Statistics.
Still, Country Garden, once China’s biggest property developer, expects to reach agreeable terms with creditors next month.
The developer defaulted on debt repayment obligations for $11 billion in offshore bonds in late 2023, deepening a debt crisis in the property sector.
Meanwhile, customs data last week showed iron ore imports stayed at 100 metric ton as China’s recent stimulus measures boosted prospects, ANZ analysts said.
China’s economy ended 2024 with an annual growth of 5%, aided by a blitz of stimulus measures, meeting government targets and beating market forecasts.
Other steelmaking ingredients on the DCE declined, with coking coal and coke sliding 2.69% and 2.65%, respectively.
Steel benchmarks on the Shanghai Futures Exchange traded mixed.
Rebar gained 0.21% and hot-rolled coil added nearly 0.3%, while wire rod and stainless steel shed 1.67% and 1.85% respectively.
The pound strengthened against the dollar in early European trading on Monday, climbing 0.3% to $1.2202 as the greenback weakened ahead of Donald Trump’s inauguration.
Market focus is squarely on the political scene in the US this week, with Trump’s "day one" policy declarations expected to shape market sentiment and influence the direction of the dollar.
“Donald Trump’s inauguration on Monday will be the main event,” said Galina Pozdnyakova, a research analyst at Deutsche Bank.
Traders are closely watching for early policy announcements on issues such as tariffs, taxes, and immigration, with tariffs set to be the key focus for foreign exchange traders.
“The relief rally may not last, with attention turning to US politics and president-elect Donald Trump’s inauguration on Monday. Since the presidential election, markets have been gripped by uncertainty over what Trump may do in office. Questions over how high tariffs will rise,” said Philip Shaw, an analyst at Investec.
Sterling was lower against the euro (GBPEUR=X), slipping 0.2% to €1.1825.
Gold prices remained steady on Monday as traders braced for increased volatility with the start of Trump’s second term. Anticipated policy announcements from Trump are expected to significantly influence market dynamics.
The spot price of gold edged up by 0.1% to $2,706.72 per ounce, while gold futures held relatively unchanged at $2,749.00 per ounce.
The precious metal, often seen as a safe-haven asset, has held steady near a one-month peak, supported by subdued US inflation data that has fuelled expectations for further rate cuts from the Federal Reserve.
Market sentiment is currently shaped by the interplay between potential US policy shifts and the Fed's monetary stance. Analysts suggest that a robust start to Trump’s second term could strengthen the dollar, while a more gradual approach may weaken it, which could in turn influence gold prices.
“The uncertainty in regard to the policies that president Trump is going to put in place has been one of the supportive factors for gold,” said David Meger, director of metals trading at High Ridge Futures.
Oil prices were lower, as expectations of Trump relaxing curbs on Russia's energy sector in exchange for a deal to end the Ukraine war offset concerns about supply disruption from harsher sanctions.
Brent crude futures lost 0.3% to $80.55 per barrel, while US West Texas Intermediate (WTI) crude slipped by the same margin to $77.67.
https://uk.finance.yahoo.com/news/pound-gold-oil-prices-commodity-currency-091633808.html
Cheap cargoes and weak refining margins boosted China’s crude oil imports from Russia to a record high in 2024, while imports from the world’s top crude exporter and Russian ally in OPEC+, Saudi Arabia, dipped by 9%, according to official Chinese data compiled by Reuters.
Last year, Chinese refiners continued to purchase lower-priced barrels from Russia and imports of Russian crude rose by 1% to an annual record-high of 2.17 million barrels per day (bpd), the data from the Chinese General Administration of Customs showed on Monday.
The higher imports from Russia highlight the Chinese refiners’ appetite for cheap crude, especially as overall Chinese imports fell in 2024, for the first time in two decades excluding the Covid period.
China’s second-biggest supplier after Russia, Saudi Arabia, however, saw its purchases in the world’s top crude importer slip to 1.57 million bpd, down compared to 1.72 million bpd in 2023.
Malaysia became the third-largest crude oil supplier to China last year, mostly due to the Southeast Asian country acting as a trans-shipment hub for Iranian and Venezuelan cargoes.
The official Chinese data didn’t show any crude imports from Iran, but it is China, especially its independent refiners, that is the biggest buyer of Iranian crude, taking more than 90% of Iran’s total export volumes.
Russia led the Chinese oil suppliers’ list last year, but Saudi Arabia began to regain some market share from Moscow in the last months of 2024, as barrels from Iran and Russia are shrinking amid tightening sanctions on tankers.
At the turn of the new year, the prices of Oman and Dubai crude jumped to a rare premium over Brent Crude, as demand for Middle Eastern oil surged in China and India. The top buyers of Russian crude are now scrambling for alternative supply after the U.S. earlier this month slapped its most aggressive sanctions yet on Russia’s oil export and export logistics.
By Tsvetana Paraskova for Oilprice.com'
Middle East crude benchmarks Oman, Dubai and Murban eased on Monday, following a sharp rally in the previous week driven by strong demand amid U.S. sanctions on Russia.
The Biden administration announced tougher sanctions targeting Russian oil producers and tankers, prompting buyers in China and India to seek alternatives.
The market is now anxiously waiting possible new policies from U.S. President-elect Donald Trump, who will be inaugurated later on Monday.
Thailand's state oil and gas firm PTT PTT bought two March-loading Murban crude cargoes, one at a premium of just below $5 a barrel and the other just above $5 to Dubai quotes on behalf of Thai refiner IRPC via a tender, traders said.
SINGAPORE CASH DEALS
Cash Dubai's premium to swaps fell 22 cents to $4.85 a barrel.
PRICES ($/BBL)
CURRENT PREV SESSION GME OMAN 83.6 84.6 GME OMAN DIFF TO DUBAI 4.9 5.12 CASH DUBAI 83.55 84.55
NEWS
China's crude oil imports from top supplier Russia were up 1% in 2024 to a record high versus 2023, while purchases from Saudi Arabia dropped 9%, data showed on Monday, as refiners chased discounted Russian supplies to cope with weakened margins.
Six Russian oil tankers still under construction by Russia's Zvezda shipyard were included in U.S. sanctions imposed last week, the first time Washington is known to have banned tankers before they even set sail, much less carried sanctioned cargo.
Libya needs between $3 billion and $4 billion to reach an oil production rate of 1.6 million barrels per day (bpd), the acting oil and gas minister, Khalifa Abdulsadek, told Reuters on Saturday, adding that a new license bidding round is expected to be approved by the cabinet before the end of January.
A group of Republican-led states filed a lawsuit on Friday challenging a ban announced by outgoing Democratic U.S. President Joe Bidenearlier this month on new offshore oil and gas development along most U.S. coastlines.
1: Introduction: Diamondback Energy is a powerful Permian player.
This article focuses on Diamondback Energy (NASDAQ:FANG), the second domestic oil producer in my portfolio, on Gurufocus. I trade this stock regularly, which is notable for being a pure play in the prolific Permian Basin.
FANG shares many similarities with Occidental Petroleum (NYSE:OXY), which I have recently covered, and EOG Resources (NYSE:EOG), among others. After completing my analysis of FANG, I plan to examine EOG Resources and a few other oil companies with strong ties to the Permian Basin.
Due to their significant success and substantial ownership of Permian production, the trioFANG, OXY, and EOGis one of the most powerful domestic players in the Permian Basin. They stand alongside super-major oil companies like Chevron Corporation (NYSE:CVX), ConocoPhillips (COP), and ExxonMobil (NYSE:XOM), which, by the way, recently acquired Pioneer Resources, becoming the number one US producer by far.
While several other companies could be considered, including Apache Corporation (APA), which had approximately 328,000 Boepd in the Permian in 3Q24, Devon Energy (DVN), which had 488,000 Boepd in the Permian in 3Q24, Civitas Resources (CIVI), which had 189,000 Boepd in the Permian in 3Q24, and Permian Resources (PR) with 151,000 Boepd in the Permian in 3Q24, these companies seem slightly less relevant in this context.
The oil equivalent production (US production only) in 3Q24 for the nine major US producers is shown below:
We can see that the trio FANG, OXY, and EOG produced 2,794K Boepd in 3Q24, mostly from the Permian Basin. By the way, OXY produced 729K Boepd in the Permian Basin during the 3Q24.
2: The Permian Basin: A prolific oil producer.
The Permian's contribution to US crude oil production is significant. In 2024, it was estimated to be 6.3 million barrels per day, accounting for 51.4% of the total output, estimated at 13.249 million barrels per day in 2024.
The Permian Basin spans New Mexico and Texas. While analysts anticipate a peak in oil production soon, the EIA predicts an increase of 4.8% yearly, equating to 6.6 million barrels per day by 2025.
Source: permianpartnership.org
As we enter 2025, it's an ideal time to assess this volatile sector and its potential by examining three reliable companies that provide low but secure dividends. Over the past year, FANG has outperformed both EOG and OXY, as illustrated in the chart below.
3: Diamondback Energy: A Focused Investment in the Permian Basin.
3.1: Oil Equivalent Production.
Diamondback recorded a big jump in production this quarter after Endeavor's merger.
The company focuses exclusively on producing hydrocarbons and natural gas from its properties in the Permian Basin. The company operates in three sub-segments of the Permian Basin: the Delaware Basin, the Central Basin Platform, and the Midland Basin.
https://finance.yahoo.com/news/diamondback-energy-powerful-permian-player-130127457.html
By Nidhi Verma
NEW DELHI (Reuters) - Indian state refiners have asked Abu Dhabi National Oil Co (ADNOC) to offer pricing its crude on a delivered basis as well to manage costs, three refining sources said, after fresh U.S. sanctions disrupted supplies and caused freight rates to spike.
Refiners in India, which imports over 80% of its oil, have been hit hard by a spike in global oil prices and shipping rates after Washington recently imposed sweeping new sanctions targeting Russian insurers, tankers and oil producers.
The world's No. 3 oil importer and consumer became the top buyer of discounted Russian seaborne oil after the European Union shunned purchases and imposed sanctions on Moscow following its invasion of Ukraine in 2022.
Russian oil accounted for more than a third of India's imports last year, but U.S. sanctions are tightening supply, pushing the buyer back to traditional Middle East sources.
While most Middle East crude producers sell oil on a free-on-board (FOB) basis via long-term contracts to Asian buyers, Russian oil traders have been supplying crude to India on a delivered at port (DAP) basis that includes insurance, shipping and other services borne by the seller.
State-owned Indian refiners including Indian Oil Corp, Hindustan Petroleum Corp (HPCL) and Bharat Petroleum Corp have asked ADNOC for DAP price quotes, the sources said.
"We want our term supplier to give both FOB and DAP quotes," one of the sources said.
"There is a possibility we may get better pricing in DAP, especially when freight rates are going to go up."
It was not immediately clear if ADNOC would agree to such terms.
The Indian state refiners and ADNOC did not immediately respond to Reuters' emails seeking comments.
ADNOC sets its monthly official selling prices (OSPs) on an FOB basis and has rarely, if ever, sold term supplies to Asian buyers on a delivered basis, three traders familiar with long-term Middle East oil deals said.
In addition to their request to ADNOC, the refiners, which own around 60% of India's 5.14 million barrels per day (bpd) crude processing capacity, planned to put in similar requests with other Middle East suppliers including Saudi Aramco, the sources said.
Under DAP terms, Indian companies would be liable for such cargoes only after they are discharged.
While freight rates have mainly risen for Russian oil, that has a ripple effect on the broader markets.
"In our spot tender also we give bidders an option to give quotes for both DAP and FOB cargoes. So now we want to extend that option to our term purchases as well," a second of the sources said.
"After our due diligence we can decide whether to go for DAP or FOB."
Indian state refiners negotiate their term contracts individually. Their combined purchase from ADNOC could be higher in the next fiscal year from April 1 than this year as HPCL operates its upgraded Vizag refinery at full capacity and starts up its new 180,000 bpd Barmer refinery in the desert state of Rajasthan this quarter, the sources said.
https://sg.news.yahoo.com/india-refiners-ask-adnoc-offer-121848552.html
Russia is likely to supply up to 55 billion cubic metres (bcm) of gas to Iran each year, as it seeks new markets following a substantial decline in gas exports to Europe.
This was revealed by Russian President Vladimir Putin at a joint press conference with his Iranian counterpart Masoud Pezeshkian on 17 January.
Since the onset of the Ukraine conflict in 2022, Russia's Gazprom has seen a drastic reduction in its once-dominant position in the European gas market.
This shift was further cemented this month when Russian gas exports to Europe via Ukraine came to a halt, ending reliance on Soviet-era pipelines and marking a shift in the European energy landscape.
Gazprom confirmed the cessation of the transit through Ukraine after the existing agreement was not renewed.
This change prompted EU buyers, including those in Slovakia and Austria, to look for alternative sources of gas.
Putin stated that while the goal is to reach 55bcm of gas exports to Iran per year, the initiative would commence with smaller volumes, starting at up to 2bcm.
The target volume is comparable to what the Nord Stream 1 undersea gas pipelines delivered to Europe before being damaged in 2022.
In June 2024, Gazprom signed a memorandum with the National Iranian Gas Company to facilitate the supply of Russian pipeline gas to Iran, although the potential pipeline routes were not disclosed.
Despite owning the world's second-largest gas reserves, Iran still imports gas, including from Turkmenistan, due to severe under-investment partly attributed to US sanctions.
Last July, Iran's Oil Minister Javad Owji mentioned that the country would be receiving approximately 300 million cubic metres of Russian gas a day or approximately 110bcm a year.
"Russia likely to supply up to 55bcm of gas to Iran" was originally created and published by Offshore Technology, a GlobalData owned brand.
https://finance.yahoo.com/news/russia-likely-supply-55bcm-gas-153318784.html
Ukraine cut Russian oil transport by 16% in 2024 - ex-energy minister
MOSCOW. Jan 20 (Interfax) - Ukraine transported around 11.36 million tonnes of Russian oil via the southern branch of the Druzhba oil pipeline in 2024, thus reducing transport by 16% compared to 2023, former Ukrainian Energy Minister Olga Buslavets said.
"This was the lowest figure at least since 2014, or perhaps even over the entire history of Ukraine's independence, since 1991," Ukrainian media quoted Buslavets as saying on her social account.
Hungary received over 4.7 million tonnes of this oil, which is virtually the same amount as that shipped to the country in 2023. Another 3.9 million tonnes of oil was transported via Ukraine to Slovakia, down 15% from 2023, and 2.7 million tonnes to the Czech Republic, down 35%, she said.
As reported, Ukraine tightened sanctions on Russia's oil company Lukoil in July 2024, thus effectively banning oil transport to Central Europe across Ukraine via the Druzhba pipeline. Lukoil was a major supplier to Hungary, where it accounts for around one third of crude imports, and to Slovakia with 40%-45%.
Hungary's MOL Group announced in September 2024 that it had concluded an agreement with oil suppliers from Russia and pipeline operators to transport oil via the Druzhba pipeline through Belarus and Ukraine to Hungary and Slovakia. MOL Group said it would take over ownership of the affected volumes of crude oil at the Belarusian-Ukrainian border.
The Western Australian government has awarded South Korean steelmaker POSCO and the Port Hedland Iron company $15 million for their Port Hedland Iron Project, which aims to decarbonize the steel manufacturing supply chain with production of low carbon hot briquetted iron for export to the Asian market.
The investment is part of the Investment Attraction Fund, worth $34 million, which has been allocated for three separate clean energy projects.
The projects will receive the funding boost as part of the Labor government’s clean energy plan to diversify the economy and set Western Australia (WA) up for the future.
Pilbara Minerals Limited has been allocated $15 million for its demonstration-scale plant that incorporates an industrial-scale electric spodumene calciner, which converts critical mineral concentrates into high-value battery precursors.
International Graphite Ltd has been awarded $4 million to fast-track the Springdale Graphite Resource for its Collie downstream processing facilities and to develop the next stages of technology and processes required to produce critical battery materials.
"WA is on track to become a global clean energy powerhouse, to keep our economy for the long term and create the jobs of the future in our State.’’ Roger Cook, premier, Western Australia
"WA is on track to become a global clean energy powerhouse, to keep our economy for the long term and create the jobs of the future in our State,’’ said Roger Cook, premier of Western Australia. "These projects are at the cutting edge of the global energy transition - whether it's reducing emissions from steel or producing the batteries the world needs for a clean energy future. Only my WA Labor Government has the plan and the experience to keep WA's economy strong and create local jobs for our future."
https://www.steeltimesint.com/news/posco-receives-15m-clean-energy-grant-from-wa-government
The Reko Diq copper and gold project in Pakistan is expected to generate approximately $74 billion in free cash flow over the next 37 years, based on consensus long-term prices, according to Mark Bristow, CEO of Barrick Gold, which owns a 50% stake in the project.
The remaining stake is held by the governments of Pakistan and Balochistan.
Reko Diq, one of the world’s largest undeveloped copper-gold areas, is anticipated to significantly impact Pakistan’s economy, which is struggling with low foreign reserves of around $11 billion. Following the resolution of a long-running dispute in 2022, the project is on track to begin production by the end of 2028, starting with 200,000 tons of copper annually in its first phase, which will cost an estimated $5.5 billion.
Completion of the first phase is expected by 2029.
In an interview with Dawn News English Bristow said The second phase, projected to cost $3.5 billion, will double production. While the mine’s reserves are estimated to last 37 years, further upgrades and expansions could extend its operational life.
The project is expected to generate significant dividends, royalties, and taxes for Pakistan.
Barrick is also negotiating with railway authorities and infrastructure providers to revamp the coal terminal at Port Qasim near Karachi to support copper transport domestically and for export. Bristow noted that the project’s timeline is on schedule, with fencing, accommodation, and surveys already completed.
Meanwhile, Saudi Arabian mining firm Manara Minerals may invest in Reko Diq within the next two quarters, Pakistani Petroleum Minister Musadik Malik said. Talks with other Gulf countries regarding mining opportunities in Pakistan are also underway. Manara executives visited Pakistan in May last year to discuss acquiring a stake in the project.
Three-month copper on the London Metal Exchange eased 0.3% to $9,167 a metric ton as at 0706 GMT after reaching a one-month peak last week.
President-elect Donald Trump returns to the White House later in the global day with an inauguration speech which traders will parse for policies to be enacted on day one. Trump has talked of tariffs of as much as 10% on global imports as well as 60% on Chinese goods and a 25% import surcharge on Canadian and Mexican products.
Goldman also noted that the oil market is pricing in a nearly 40% chance of a 25% US tariff on Canadian goods including oil, versus the bank’s 15% subjective probability of a 25% effective tariff by the end of the year.
Brent crude futures traded around $80.69 a barrel, while the more active US West Texas Intermediate crude April contract was steady at $77.36.
The investment bank assigned a 10% chance to a 10% effective tariff on gold being introduced within the next 12 months. It said bullion’s status as a financial asset makes it likely to be exempt from broad-based tariffs.
Spot gold prices were up 0.3% at $2,708.77 per ounce while US gold futures were little changed at $2,749.70.
The amount of gold stocks in COMEX-approved warehouses has jumped by one-third in the past six weeks as market players sought deliveries to hedge against the possibility of tariffs.
(By Ashitha Shivaprasad and Ishaan Arora; Editing by Christopher Cushing)
Rio Tinto and Glencore reportedly held talks about a potential merger late last year, but the talks are no longer active, a source revealed to Bloomberg.
If successful, the merger would effectively create the world’s largest listed mining company, combining the strengths of Glencore, a global leader in coal and base metals, and Rio Tinto, the world’s second-largest miner.
While neither Rio Tinto nor Glencore have commented on the matter, analysts believe Rio’s interest may have been centred on Glencore’s extensive copper assets, a critical resource as industries transition to cleaner energy.
However, Rio would’ve likely been less interested in Glencore’s coal portfolio after it exited coal mining in 2018 to focus on renewable energy materials.
Tribeca Investment Partners portfolio manager Ben Cleary said Rio would have to pay a significant premium if they were interested in the merger.
“Anything under five pounds wouldn’t make sense for Glencore (which was trading at 3.8 pounds per share at the time of writing) given … material capital returns this year,” Cleary told Reuters.
CreditSights, a Fitch Solutions Company, said Rio Tinto is traditionally conservative and focused on stability, whereas Glencore is known for its aggressive approach and constantly pushing the envelope.
“This cultural divide might pose challenges in integration and decision-making if a merger were to proceed,” the analyst said.
“If this materialises, it could have broader implications for mega deals in the metals and mining space, potentially putting BHP/Anglo American back in play.”
BHP’s $74 billion bid for Anglo American collapsed in May 2024 due to complications with deal structuring.
The transaction involved the demerger of Anglo American Platinum and Kumba Iron Ore, which Anglo described as “highly unattractive”.
Anglo American chair Stuart Chambers said the demerger would’ve taken as long as 18 months to complete, carrying “significant execution and completion risks relating to both value and time”.
While merger discussions between Rio and Glencore are not currently active, it does highlight the current deal-making appetite in the global mining sector and the importance of inorganic growth to future-proof a company.
https://www.australianmining.com.au/is-this-minings-next-major-ma/
The MRE also has 12 million inferred tonnes at 0.57% copper, 3.92% zinc, 0.47% lead, 66.3 g/t silver, 0.33 g/t gold and 25.5% barite, for 151.5 million lb. of copper, 1.04 billion lb. of zinc, 125.2 million lb. of lead, 25.6 million oz. of silver, 128,100 oz. of gold and 3.05 million tonnes of barite. The contained copper in this category increased by 22% (28 million lb.).
American Pacific CEO Warwick Smith said the updated MRE marks a “major project milestone” for the company now that it has secured 100% ownership of the Palmer project.
In late 2024, American Pacific took full control of the project after agreeing to provide Dowa Metals & Mining, its joint venture partner who held a 55% stake, an option to buy half of the future zinc concentrate production from Palmer.
Infill drilling success
Dowa, owner of Japan’s largest zinc smelter, has been funding work on the Palmer project in the lead-up to the MRE, including a $20 million resource definition and geotechnical program in 2023. By the end of that year, the Palmer project had seen over $100 million in total spending, with another $12.8 million earmarked for 2024.
“Infill and geotechnical drilling over the last several years has been successful in increasing our confidence in the known deposits and we are thrilled to see significant increases in the in-situ copper estimate, in addition to an overall increase in contained tonnes for the project,” said Smith.
In an emailed statement to Mining.com, he emphasized that the vast bulk of the drilling was infill drilling, where typically “you’d be happy to keep 75-80% of your existing tonnes (both indicated and inferred) when updating an MRE.”
“In this case, we saw a significant increase. Certainly, we also see that the copper at Palmer becoming more dominant – which is now 51 million new lb. of copper,” Smith noted.
The new resource is calculated from a database of 284 diamond drill holes for a total of 96,485 metres of drilling, of which 241 holes (82,132 metres) are within the mineralized boundaries prepared for the MRE. The mineralization for the estimate was defined in three main domains, including the South Wall (SW) and RW domains (Palmer deposit) and the AG domains (AG deposit).
The Palmer and AG deposits currently anchor the project’s 2019 preliminary economic assessment, which found that the copper-zinc resource could support an 11-year mine (plus a two-year pre-production period). It has a post-tax net present value (at a 7% discount) of $266 million and a 21% internal rate of return.
Shares of American Pacific Mining were up 2.3% by 11:30 a.m. ET, trading at the midpoint of its 52-week range at C$0.22 apiece. The company’s market capitalization is approximately C$47.4 million.
https://www.mining.com/american-pacific-boosts-copper-resource-at-palmer-project-in-alaska/
Chinese scientists have unveiled a revolutionary steel-making method that slashes production time from hours to mere seconds, while eliminating coal. Discover how this breakthrough could reshape global markets and drive sustainability efforts worldwide.
Chinese scientists have come up with a groundbreaking way to make steel that’s set to change the industry big time. This new method is not just faster but also eco-friendly, fitting right in with global goals to cut down on carbon emissions. Since China is the world’s top steel producer, this breakthrough could mean big changes for both local and international markets.
What a decade of hard work can achieve
This cool new method didn’t happen overnight. It took over ten years of dedication from Chinese scientists who wanted to make steel production more efficient. Zhang Wenhai, the main brain behind the study that lays out this technique, was key in making it happen. The South China Morning Post recently shared their findings, pointing out how this could totally change the old-school ways of making steel.
Traditionally, making steel takes forever—think crushing iron ore, turning it into pellets, and heating them up to 1,300°C before mixing with coke (processed coal) in a blast furnace. This whole thing can take hours! But now, with this new method, we’re talking about cutting that down to just three to six seconds.
How does the new process work?
The magic here involves injecting finely ground iron ore powder into a super-hot blast furnace using something called a vortex lance. This triggers an “explosive chemical reaction,” forming liquid iron droplets quickly that settle at the furnace’s bottom. The iron from this process is super pure and ready to go.
Not only does this speed things up, but it also cuts out coal entirely. By doing so, China’s energy costs for making steel could drop by a third—a big deal for hitting national targets on cutting carbon dioxide emissions.
Why it matters for the environment and economy
This new way of producing steel comes with huge environmental perks. Ditching coal fits perfectly with worldwide efforts to shrink our carbon footprint across different industries. On top of that, economically speaking, it could boost China’s standing in sectors like car manufacturing that heavily rely on steel.
China has tons of low-quality iron ore reserves which can now be used effectively thanks to this new approach. Before this, they had to import higher quality ores from places like Australia, Brazil, and Africa. Now they can use their own resources better—less dependency on imports means more self-sufficiency when it comes to raw materials.
Could this change the world market?
If Chinese industries start using this method widely, we might see some serious shifts in global markets. As the biggest player in steel production worldwide, China’s ability to churn out products faster and maybe even in larger quantities could shake up competition across industries everywhere. Plus, since exports relying on steel might have lower carbon footprints now—they could become even more attractive globally.
But it’s not just about staying competitive; it’s also about stepping towards sustainable industrial practices globally. As countries wrestle with climate change issues, breakthroughs like these set standards for slashing industrial emissions while still boosting economic growth.
This amazing leap forward in steel-making tech shows off China’s commitment to innovation and its active role in tackling environmental problems head-on. Other countries might feel the heat watching these developments unfold—they may need to hop on board or push boundaries further if they want any chance at keeping up as global market dynamics continue evolving fast.
Ultimately though? This transformative method doesn’t just challenge how we’ve traditionally viewed industries—it opens doors for future advances prioritizing both efficiency and sustainability—a crucial mix nowadays as we all reach for greener pastures!
