Trends back rebirth of Australian green iron and steel sector

By Peter Roberts

Much of Australia’s modesty sized steel sector was born through the adversity of distance from established suppliers and the threat Japan posed to Australia during WW2.

Since then there has been some development of electric arc furnaces utilising scrap as a feedstock, but otherwise Japan, then Korea and China have swamped Australian plans such as that of Lang Hancock who envisioned a WA-Queensland linked steel renaissance.

A renaissance looks increasingly close with the twin trends of decarbonisation of hard to abate steel plus new routes to steel manufacture that rely on magnetite ore rather than traditional haematite which dominates Australia’s iron ore exports.

South Australia is the centre of this trend with GFG Alliance developing the Whyalla steelworks as a magnetite fed electric arc furnace and two major magnetite mining and value adding plays feeding into a new state government green iron and steel strategy.

Lincoln Minerals is in the midst of a partnering process for its massive green iron ore mine and potential green iron or steel production near Port Pirie in South Australia.

And Iron Road told investors today that master planning had begun for a green hydrogen manufacturing precinct at its proposed Cape Hardy export port (pictured) on Eyre Peninsula.

All this is underpinned by SA’s construction of a hydrogen electrolyser and power station and regional desalination plant to supply water at Whyalla, and the recently released state green iron and steel strategy.

The strategy builds on support for a hydrogen power plant – a world first – with support for a new 2.5 mpta direct reduction green iron plant that would add 2,500 jobs during its construction, 800 ongoing operational jobs and add $3 billion per annum to South Australia’s gross state product.

We shouldn’t overlook other Australian green iron efforts including Fortescue which has successfully processing 150kg of iron ore to make metallic iron that could pave the way for the production of green iron at scale.

Nor should we forget that other nations are far more determined and far better funded by government to secure value adding locally than is Australia – many here still believe our future lies in exporting undifferentiated commodities.

The steel industry we know today which descended from BHP Steel which was based on shipping iron ore from Whyalla to steel mills in Port Kembla and Newcastle in NSW, and coal from NSW to Whyalla.

But BHP has retreated from value adding to be a pure miner – what an achievement of minimal ambition – and BlueScope Steel and GFG’s Liberty Primary Steel dominate local steelmaking.

But for how long?

The future is looking very different form the past and possibly, just possibly, Australia with the support of the National Reconstruction Fund could see the birth of a sustainable modern green iron and steel sector.

Further reading:
Gupta plans expansion of Whyalla iron ore and green steel – reports
Fortescue breakthrough in making green iron matches GFG Alliance
Magnetite secures Japanese support for green iron project

Iron Road plans ‘green’ manufacturing in SA hydrogen zone

Picture: Liberty Steel Group/Whyalla steel works