ISIJ International
Online ISSN : 1347-5460
Print ISSN : 0915-1559
ISSN-L : 0915-1559
Review
Production and Technology of Iron and Steel in Japan during 2015
JOURNAL OPEN ACCESS FULL-TEXT HTML

2016 Volume 56 Issue 6 Pages 905-916

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1. Overview of the Japanese Iron and Steel Industry

Last year, the Iron and Steel Institute of Japan (ISIJ) celebrated its 100th anniversary. The first issue of Tetsu-to-Hagané was also published in 1915, the same year as the ISIJ was established. In that publication, before technical reports, articles on business conditions and statistics, etc., several distinguished gentlemen whose efforts led to the creation of the ISIJ contributed commentaries on the steel industries of Japan and other countries. Those articles included “The Past and Future of the Iron and Steel Industry in Japan” by Dr. Kageyoshi Noro (Professor, Tokyo Imperial University, Faculty of Engineering, 1st Chairman of the ISIJ), “The Iron and Steel Industries of the Great Powers” by Dr. Tsuruo Noda (General Manager, Steelmaking Dept., Kure Naval Arsenal, 10th Chairman of the ISIJ) and “Concerning the Business of Yawata Steel Works” by Dr. Susumu Hattori (Assistant Superintendent, Yawata Steel Works and concurrently engineer, 7th Chairman of the ISIJ). The origin of today’s Technical Society was five research committees (Pig Iron, Steelmaking, Steel Products, Castings and Iron and Steel Science) which were established in 1925, about 10 years after the establishment of ISIJ itself. Following the Second World War, those committees continued their activities as the Iron and Steel Technology Research Liaison Council (later called the Steel Technology Joint Research Society), which was cosponsored by the ISIJ, the Iron & Steel Bureau of the Ministry of Commerce and Industry (later, the Heavy Industries Bureau of the Ministry of International Trade and Industry (MITI)) and the Japan Steel Association (later the Japan Iron and Steel Federation). Subsequently, jurisdiction for these activities was transferred to the ISIJ and it became the Joint Research Society. As a result of a sweeping reorganization of the ISIJ in 1995, the Technical Society and Academic Society were established, and the committees which were established in the Technical Society later became the current 19 Technical Committees. Tracing the history of this “Production and Technology of Iron and Steel in Japan,” the first predecessor of this annual review was published in 1957 under the title “Perspective of Production and Technique of Iron and Steel in Japan” by Dr. Takeshi Yamaoka, who was the Secretary-General of the Joint Research Society. In 1960, the title was changed to the present version, and in 1996, publication was changed from the ISIJ technical journal Tetsu-to-Hagané to Ferrum (Bulletin of the Iron and Steel Institute of Japan). With this year’s edition of “Production and Technology of Iron and Steel in Japan,” we celebrate the 60th article in this series.

As in previous years, this year’s review of the production and technology of iron and steel in 2015 begins with an overview of the important political and economic situations which affected Japan during the year. First, looking at the political conditions surrounding Japan, key developments included the enactment in September of national security-related laws which approve the use of the right of collective self-defense, basic agreement in October by the 12 countries participating in negotiations on the Trans-Pacific Partnership (TPP), agreement by the ruling party in December to introduce a reduced tax rate when the consumption tax will be raised to 10% in April 2017, and preparations for the introduction of the “My Number” system, which began in January 2016. Next, regarding economic conditions in Japan, in comparison with 2014, when the economy was adversely affected by an increase in the consumption tax, government economic reports, etc. showed improvement in the employment and income environment in 2015. This positive turn was driven by an economic and fiscal policy built on the pillars of bold monetary policy, flexible fiscal policy and a growth strategy to encourage private investment. In view of this improvement, as well as more favorable terms of trade thanks to lower crude oil prices, a continuing moderate recovery has been assumed. However, the recovery stalled in the second half of 2015 due to a slowdown in the emerging economies, and particularly China, a further drop in the price of crude oil, and other negative factors. As a result, the real GDP growth rate is expected to be around 1.2% for fiscal year 2015, and a nominal GDP growth rate of about 2.7% is foreseen.1,2)

Under these economic circumstances, Japan’s crude steel production for calendar year 2015 decreased by 5.0% from the previous year, to 105.15 million tons (Fig. 1)3,4) According to the Japan Iron and Steel Federation (JISF), domestic iron and steel demand was generally stagnant in FY 2015, as there was no upsurge in capital investment in nonresidential building, industrial machinery, electrical machinery, etc., and the recovery of domestic auto sales was also delayed. Foreign demand was also weak due to the high level of Chinese steel exports, which caused a further relaxation of global supply and demand, and trade problems occurred frequently in many areas. As a result, in spite of various management measures by Japan’s steel companies, a downward correction in profitability predictions for the March 2016 period became inevitable. In particular, in response to the economic slowdown in China from summer, companies became increasingly cautious about investments, and exports were also sluggish. As has been pointed out for many years, excess production capacity in China is a fundamental problem. Moreover, in response to declining domestic steel consumption, China’s steel exports exceeded 100 million tons for the first time. Thus, economic conditions in China clearly have a very large impact on Japanese iron and steel industry.

Fig. 1.

Transition of crude steel production in Japan (calendar year).3,4)

On the raw material side, major producers of raw materials for iron and steel, and particularly iron ore and metallurgical coal, continued to produce at historically high levels in spite of the relaxation in steel supply and demand worldwide. Although the prices of those raw materials rose to very high levels at one time, prices have tended to decline since peaking in 2011, and that trend also continued in 2015 (Fig. 2). Overseas investment and offshoring of production continued in various product fields, in line with the overseas strategy of each steel company. In particular, there were many examples of offshoring of production of automotive materials. Overseas development in the form of capital participation in the construction of integrated steel works in Southeast Asia could also be seen. The following sections present an overview of the conditions affecting the Japanese iron and steel industry in 2015, focusing on trends in raw materials for iron and steel, trends in steel-consuming industries, crude steel production in Japan and worldwide, globalization efforts of Japanese steel companies, and recent conditions in China.

Fig. 2.

Transition of world pig iron production and unit price of imported iron ore & metallurgical coal (calendar year).6)

1.1. Trends in Raw Materials for Iron and Steel

Oligopolization of the iron ore market by three major ore producers (Vale, Rio Tinto and BHP Billiton) and a basic tone of increased production continued in 2015. Production by all of these companies was on historically high levels. According to the Metal Resources Report5) published by JOGMEC, these companies are engaged in an intense, ongoing struggle for share, taking advantage of price competitiveness gained by exhaustive cost-cutting efforts. While world crude steel production decreased from the previous year for the first time in 6 years, and pig iron production has basically been flat since around 2012, production of iron ore has remained high, creating an over-supply situation. As a result, the price of iron ore continued a downward trend from its peak in 2011. In particular, the decline in the spot price of iron ore landed in China, which is an index of the quarterly price of iron ore, has been accelerated by continuing purchases of iron ore, which is comparatively economical due to the loose supply-and-demand conditions in Asian steel markets and the accompanying softening of steel prices. Moreover, supply-and-demand conditions for metallurgical coal are similar to those affecting iron ore. Although suppliers of metallurgical coal have continued to increase production, stagnant coal prices have resulted in deteriorating profitability. Given this situation, there have been reports that moves to reduce coal production may be easier than in the case of iron ore. Figure 2 shows the transition of world pig iron production and the unit price of imported iron ore and metallurgical coal according to the World Steel Association and customs statistics of Japan’s Ministry of Finance.6) These figures show that the highest prices of iron ore and metallurgical coal in 2011 were $167/ton and $229/ton, respectively, but in 2015, prices fell to $71/ton for iron ore and $94/ton for metallurgical coal, or roughly the same levels as 10 years ago.

1.2. Trends in Steel-consuming Industries

This section presents an overview of trends in steel-consuming industries in 2015 based on the quarterly steel supply-and-demand report of the Japan Iron and Steel Federation (JISF)7) and the websites of the Japan Automobile Manufacturers Association, Inc., the Shipbuilders’ Association of Japan, the Japan Electrical Manufacturers’ Association, etc. For details, please refer to the original text or to the websites of the JISF, the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) and manufacturers’ associations.

[Civil engineering] Due to a decrease in budgets for public works projects in FY 2015 (total of supplementary budget for FY 2014 and original budget for FY 2015) and the reactionary decrease associated with the Tokyo-Gaikan Expressway project, which was a large order issued in April 2014, public works civil engineering projects declined in the first half of FY 2015. No signs of recovery could be seen in the second half, and the contract amount of public works projects, which is a leading indicator, continued to be weak, falling below the level of the same period last year. In private-sector civil engineering, a favorable tone is expected for the year as a whole, as a domestic return could be seen in some industries and capital investment was firm.

[Construction] In FY 2015, dwelling buildings construction tended to recover from the negative reaction to the consumption tax increase in 2014. Although new construction starts of dwellings had fallen to 800000 from 2010, this index returned to the 900000 level last year. By owner-occupant relation, construction of houses for rent showed a favorable trend, and there was also a recovering tendency in construction of owned house, buoyed by government housing support, while the tone in starts of construction of ready-built dwellings for sale were also firm. In non-dwelling construction (such as offices, stores, and factories, etc.), an expansion in building starts was expected due to the recovery of corporate profits, but overall, the feeling in this area remained bearish due to the chill in investor sentiment caused by stagnation in the Chinese economy, etc.

[Shipbuilding] The volume of new shipbuilding starts continued to decline from the peak around 2010. Although the market for new ships has been extremely difficult recently, many shipyards secured backlogs extending to around 2018 due to stricter ship hull structure regulations from July 2015 and strengthening of NOx emission regulations on ships started in and after January 2016. By ship type, the shares of orders for oil tankers, LNG ships and container ships increased. While there was some feeling of stagnation in the volume of shipbuilding starts and in the amount of consumption of steels in FY 2015, roughly the same levels as in the previous year are foreseen for the year as a whole.

[Motor vehicles] In new domestic motor vehicle sales for 2015, unit sales of large and small passenger cars other than midget passenger cars gradually improved, but unit sales of midget passenger cars decreased due to an increase in the light vehicle tax, and there was also a decrease in comparison with the previous year (for the year as a whole). Although exports of completed vehicles increased, centering on a strong North American market, domestic production of completed vehicles decreased overall. According to the Japan Automobile Manufacturers Association, production of four-wheeled vehicles in 2015 was 9278 238 units, which was a decrease of 496427 (5.1%) from 2014, and as a result, steel consumption also declined.8)

[Industrial machinery] In shipments of construction machinery, implementation of stricter exhaust gas regulations was completed, and the downturn following the buying-rush demand ahead of those regulations became apparent. Capital investment-related fields such as boilers/motors and metal processing and fabricating machinery were also weak, as companies postponed spending in response to increasing uncertainties about external demand. On the other hand, the tone in transportation machinery was strong, supported by increased construction of distribution warehouses. Among orders received for industrial machinery in 2015, private sector demand increased, but both public demand and external demand decreased, resulting in a decrease of 2.9% from the previous year in this sector as a whole. The price of crude oil, which fluctuated widely during 2014, also continued to show a downward trend in 2015. The price was on the $50/barrel level at the start of the year, but had fallen to the $30 level by year-end. As a result, the recovery of demand for energy-related steel products was also delayed.

[Electrical machinery] With the exception of certain replacement demand by domestic electric power companies, the order environment for heavy electrical machinery was difficult due to weak external demand, particularly in the emerging countries, together with a declining trend in orders as companies postponed capital investment. The trend in the telecommunications field was also weak following the completion of a series of investment related to LTE (Long-Term Evolution: high speed communication). In home electrical appliances, the reaction to the consumption tax increase had run its course. Production of some types of flat-panel televisions increased, and conditions suggested that consumer electronics had also bottomed-out.

In 2015, the sustaining member companies of the ISIJ also developed new products responding to these trends in steel-consuming industries, centering mainly on civil engineering, construction and automobiles.

1.3. Crude Steel Production

During calendar year 2015, crude steel production in Japan was 105.15 million tons, representing a decrease of 5.0% from the 110.67 million tons in 2014. Thus, crude steel production fell below the 110 million ton level for the first time in 3 years, after exceeding 110 million tons for two consecutive years (2013, 2014). By furnace type, converter steel production was 81.04 million tons (decrease of 4.6% from 2014) and electric furnace steel production was 24.11 million tons (6.1% decrease). The share of electric furnace steel was 22.9%, which was a decrease of 0.3 points from the previous year (Fig. 1).

World crude steel production in calendar year 2015 was 1622 million tons, or a 2.9% decrease from the 1670 million tons of the previous year.9) Following the global financial crisis triggered by Lehman Brothers’ bankruptcy, world crude steel production declined from the previous year in 2008 and 2009, but increased thereafter. However, in 2015, world production decreased from the previous year for the first time in 6 years as production decreased from the previous year in China, where production had grown continuously until then. Among the top 10 countries in world crude steel production, production declined from the previous year in all countries except India (Table 1). According to the World Steel Association (WSA), the average operating rate of the main 66 steel-producing countries in 2015 was 69.7%,9) which was a decrease of 3.7 points from the 73.4% in 2014.

Table 1. Top 10 crude steel production countries (Source: WSA; Unit: Mt).9)

The forecast for steel demand in FY 2016 published by the Japan Iron and Steel Federation predicts an overall increase in domestic demand due to the buying rush before the consumption tax increase planned in April 2017, the start of urban redevelopment projects, beginning with projects related to the 2020 Tokyo Olympics, etc. However, in foreign demand, the JISF foresees a decline in Japan’s iron and steel exports due to the continuing relaxation of world supply and demand due to increased exports by China. As a result, crude steel production in FY 2016 is expected to be on the same level as in FY 2015, but the risk of a downturn in foreign demand cannot be ignored.10)

1.4. Globalization of the Japanese Steel Industry

During 2015, as in previous years, there were reports of globalization efforts in the form of investment in overseas projects, etc. by Japanese steel makers.11) This section summarizes the moves by the main sustaining member companies of the ISIJ.

In February, Nippon Steel & Sumitomo Metal reached agreement with Africa’s largest general can manufacturer on a stable, long-term supply of tinplate for food cans, and in May, and announced the construction of a production system for high formability, ultra-high strength steels for automotive use by a joint venture in North America. In other moves involving subsidiaries and joint ventures of the same company, a new hot dip Zn-coated steel strip production plant began operation at Baosteel-NSC Automotive Steel Sheets Co., Ltd. (BNA) in China in September, VAM® BRN SDN BHD held the groundbreaking ceremony for a steel tube joints processing company in Brunei in October, its crankshaft manufacture and sales subsidiary in the US, International Crankshaft, Inc. (ICI), began commercial production at No. 4 forging press line of in November and Nippon Steel & Sumikin Cold Heading Wire (Suzhou) Co., Ltd. began operation in China in December.

JFE Steel reached agreement with the United Arab Emirates for a joint venture large-diameter welded steel pipe plant in March, participated in the planning of an integrated steel works project in Vietnam of the Formosa Plastics Group in July and concluded an agreement in connection with the same project in September and held the Opening Ceremony for a joint venture, Jiaxing JFE Precision Steel Pipe Co., Ltd., in China in October. In December, a new company was established by a merger of the iron ore mining business of a steel company in Brazil with a company which will produce and sell iron ore in Brazil with investment by JFE Steel, domestic steel makers and a trading company, and steel makers in Korea and Taiwan.

Kobe Steel began a joint study of the establishment of a joint venture for the production and sale of wire rod material in Thailand in June, and its wire rod secondary processing subsidiary in China increased its capacity in November.

Among special steel makers, Daido Steel constructed a new base for its die and mold forging business in Thailand in May, and Sanyo Special Steel established and began operation of a machine parts and tooling company in Mexico in December.

1.5. Recent Situation in China

In 2015, world crude steel production decreased for the first time in 6 years. The effect of the downturn in Chinese production, which had increased until then, was particularly large. China has also increased exports of steel products in response to sluggish domestic demand. Chinese steel exports reached a historically high level, exceeding 100 million tons/year, which contributed to the global relaxation of supply and demand. Considering the importance of these and other developments in China, the following will review the recent economic situation and condition of steel supply and demand in China.

Looking first at the economic situation in China, although the business slowdown due to stagnant domestic demand continued, China’s GDP is still rising, which indicates that economic growth is continuing. Comparing the nominal GDPs of the major countries, China overtook Japan in 2009 and became the world’s second largest economy after the United States, and its economy continued to grow thereafter at an annual rate of more than 10% (Fig. 3).12) However, China’s real GDP growth rate has decreased gradually since peaking at 14.7% in 2007, and there was also a slowing tendency in the activities of manufacturing industries as a whole beginning in the second half of 2015. As a result, China’s economic growth rate was 6.9% in 2015, and thus fell below 7%.

Fig. 3.

Transition of nominal GDPs of major countries (calendar year).12)

Until recently, apparent consumption of steel had tended to increase annually. However, under the economic conditions outlined above, apparent steel consumption declined to 711 million tons two years ago (2014) after peaking at 735 million tons in 2013, and also decreased from previous year for the first time (Fig. 4).9) Because crude steel production lag one year behind apparent steel consumption, crude steel production peaked at 823 million tons in 2014 and then fell to 804 million tons in 2015, for a decrease of 19 million tons or approximately 2.3% (Fig. 5).9) During this period, export of steel from China increased annually, exceeding 100 million tons for the first time and reached 112 million tons in 2015 (Fig. 6).3) Furthermore, the price of steel products has decreased as a result of looser supply and demand due to this increase in steel exports, causing a remarkable deterioration in the profitability of companies in other steel exporting countries, beginning with Japan. The rapid increase in steel consumption and crude steel production in China, which began in the 2000 s, had been attributed to robust demand in the coastal areas of China, where more than 40% of the nation’s total population is concentrated. In particular, the construction sector accounts for more than 50% of steel consumption. If related fields are also included, construction substantially accounts for around 60–70% of Chinese steel demand. Although it is thought that this strong demand has roughly reached its peak, a stable, high trend in steel demand is seen after this peak in the future. Regionally, this will be supported by rising demand in inland China. Moreover, growth is also expected in new steel-consuming industries; these include non-construction sectors such as automobiles, household electrical appliances, machinery, etc. On the other hand, it is generally thought that China has excess production capacity of approximately 400 million tons in comparison with necessary steel demand. With sweeping improvement needed in the structure of steel production in China, it appeared that the government was implementing various measures, going beyond those taken to date, from the second half of 2015 with the aim of promoting concentration and reorganization (integration and abolition) of production facilities.13)

Fig. 4.

Transition of apparent consumption of steel of major countries (calendar year).9)

Fig. 5.

Transition of crude steel production of major countries (calendar year).9)

Fig. 6.

Transition of export of steel of major countries (calendar year).3)

2. Technology and Equipment

2.1. Technical Environment of the Japanese Iron and Steel Industry

During 2015, the Japanese economy as a whole continued to mark time, and recovery of domestic demand was delayed. Exports were also sluggish due to the economic slowdown in the developing countries, and with the high level of steel exports from China, the global relaxation of supply and demand became increasingly serious. Under these conditions, Japan’s crude steel production in calendar year 2015 was 105.15 million tons, or a decrease of 5.0% from the previous year. From the second half of 2015, the stagnation of the Chinese economy also became apparent. Because excess production capacity again became a problem, the Chinese government laid out policies calling for elimination of excess capacity, acceleration of corporate M&A, etc. There were also moves toward concentration of production facilities by Japanese steel companies. In the mid-term management plan announced in March, Nippon Steel & Sumitomo Metal presented plans to construct the optimum iron source system, which included idling Kokura No. 2 blast furnace at Yawata Works (Kokura Area) in addition to the changeover to a 2-blast furnace system at Kimitsu Works announced earlier. In August, Kobe Steel announced that it would invest in a second dephosphorization furnace at its new hot-metal pretreatment plant at Kakogawa Works, in line with the previously-announced plan to concentrate the upstream process at Kobe Works to Kakogawa. Moves toward concentration of production also continued in the electric furnace industry, as Osaka Steel shut down the steelmaking shop at Okajima Works and Kyoei Steel decided to idle the steelmaking shop at Osaka Works, among other developments.11)

Japan’s Ministry of Economy, Trade and Industry (METI) formulated “Plans on Competitiveness Improvement for Metallic Materials” as a policy for enhancing the competitiveness of the metallic materials industry, which is a “key export industry” of Japan that “supports local economies and job creation.” This policy comprises three strategies, (1) Strategy for technology development, (2) Strategy for strengthening domestic manufacturing infrastructure and (3) Global strategy.14) Because equipment-related accidents occurred at several steel works during 2014, METI also carried out an investigation to verify the condition of government-private sector efforts to prevent industrial accidents in the steel industry in the past 10 years, and compiled “Countermeasures for Prevention of Industrial Accidents in the Steel Industry: 13 Desirable Efforts.”15)

Next, notable developments in National Projects related to research and development of iron and steel technology will be summarized. In “CO2 Ultimate Reduction in Steelmaking Process by Innovative Technology for Cool Earth 50 (COURSE50), which is a project of METI and the National Research and Development Agency New Energy and Industrial Technology Development Organization (NEDO), the test blast furnace with an inner volume of 10 m3 under construction at Kimitsu Works of Nippon Steel & Sumitomo Metal was completed in September and trial operation began. The purpose of this facility is to conduct combined tests of hydrogen reduction and CO2 separation and recovery, which are the key issues in Step 2 of COURSE50.22) Another METI National Project, “New Structural Systems Using Innovative New Structural Materials,” which involves technology development by the Innovative Structural Materials Association (ISMA), was launched in 2013 and completed its second year in 2015. As part of the development of ultra-high strength steel sheets in the field of iron and steel materials, the results of control of the carbon concentration distribution in the residual γ phase were reported.16) Next, the Cross-ministerial Strategic Innovation Promotion Program (abbreviation: SIP) of the Council for Science, Technology and Innovation of the Cabinet Office, Japan took up “Innovative Structural Materials,” which is one of 10 themes of the SIP program, and undertook basic research and development of iron and steel materials in the sub-theme Structural Materials for Innovation (SM4I) region.17) In the Industry-Academic Collaborative R&D Programs sponsored by the Ministry of Education, Culture, Sports, Science & Technology (MEXT) and the National Research and Development Agency Japan Science and Technology Agency (JST), “Heterogeneous Structural Control: Towards Innovative Development of Metallic Structural Materials” was in its 6th year. In addition to 9 new themes in the first year, 2010, 3 in 2011, and 3 in 2014, the program also selected 3 new themes in 2015.18) This long-range, 10-year R&D project is expected to create guiding principles for the development of new structural materials.

The ISIJ began extraction of issues for the civil engineering and construction markets by establishing a Working Group for Study of the Use of Steel Materials for Construction in the Technical Society with the aim of identifying new issues for research at the scientific society level. In cooperation with the Japanese Society of Steel Construction, this WG is studying proposals for new steel structural systems for the construction market. The existing WG for Study of Slag Technology is studying the development of uses for steel slag and is expected to propose plans for new themes.

As described above, the iron and steel industry of Japan is striving to improve the level of technology through cooperation among industry, academia and the government in order to overcome increasingly intense international competition. The following introduces the main technological trends by field of iron and steel technology and technology topics of sustaining member companies of the ISIJ.

2.2. Iron-making

Pig iron production in calendar year 2015 was 81.01 million tons, which was a decrease in comparison with the 83.87 million tons in 2014.19) Average blast furnace productivity was 1.86 ton/m3-day; this was also a decrease from the 1.93 ton/m3-day of 2014. At the end of 2015, 27 blast furnaces were in operation, which was the same as the previous year, and the number of blast furnaces with inner volumes of more than 5000 m3 was also unchanged at 14.

Nippon Steel & Sumitomo Metal began recycling of container and packaging plastics (waste plastics) in 2000. These waste plastics are charged into coke ovens and are recycled as oil (40%) for use as a chemical feedstock, coke (20%) and gas (40%). In March 2015, a waste plastics addition facility was introduced at Wakayama Works. With the startup of that facility, the company now recycles waste plastics at all of its steel works which operate coke ovens.

2.3. Steelmaking and Iron Powder

Crude steel production in calendar year 2015 was 105.15 million tons, and thus decreased in comparison with the 110.67 million tons of 2014 (Fig. 1). The ratio of continuous casting slabs in slabs/ingots for rolling is shown in Fig. 7.19) The continuous casting ratio of special steel was 94.9% and was flat in comparison with the previous year.

Fig. 7.

Ratio of continuous casting slabs in slabs/ingots for rolling.19)

In January 2015, JFE Steel started operation of No. 3 Basic Oxygen Furnace at No. 3 Steelmaking Shop, West Japan Works (Fukuyama District), and introduced a state-of-the-art hot metal pretreatment process utilizing No. 3 BOF. Reduction of reaction efficiency during dephosphorization is prevented by once discharging the SiO2 generated in the desiliconization process. This realizes a large reduction in consumption of submaterial limestone in comparison with the conventional converter process.

At Kobe Steel, the equipment of the steelmaking shop at Kakogawa Works was expanded as part of the concentration of the upstream process, and new molten steel treatment equipment (No. 2 Ladle Furnace (2LF)) was started up in advance of other facilities in October 2015. 2LF uses an arc heating method with bubbling stirring by a top lance and has a heat size of 250 ton/charge. The capacity of the heating transformer is 36500 KVA. The increased molten steel refining capacity of this equipment, which includes desulfurization and inclusion control, will respond to a higher production ratio of Only One products.

Nisshin Steel completed the construction of a new vertical-bending slab caster (No. 2 continuous casting machine, 2CC) at Shunan Works in April 2015. The specification of the new continuous caster is a 1 strand machine with a machine length of 25.8 m and capacity of 80 t/charge. Annual production capacity is 800000 tons/year. The slab size is 150–250 mm in thickness by 700–1650 mm in width, and the maximum casting speed is 1.6 m/min. The new machine realized improvement in the quality of stainless steel slabs, higher productivity thanks to the increased casting speed and expansion of the available product range by expansion of the slab width and weight. Completion of 2CC concluded a steelmaking modernization project which has been underway since October 2013. By realizing a 800000 ton/year system at Shunan Works, this project made it possible to shut down the steelmaking process at Kinuura Works. In October 2015, Nisshin also constructed a new electrode heating type ladle refining furnace for the secondary refining process at Kure Works to enhance its refining capacity (inclusion floatation and separation, etc.) for high cleanliness steel production so as to meet the higher quality needs for special steel.

In the field of iron powder, JFE Steel newly expanded its production equipment for the high functionality iron powder product at East Japan Works (Chiba District) in July 2015. This resulted in a 25% increase in production capacity for this product line, from 28000 ton/year to 35000 ton/year.

2.4. Steel Products

2.4.1. Sheets

In the field of automotive frame components, use of ultra-high tensile strength steel is increasing in order to satisfy both enhanced crashworthiness and improved fuel economy by auto body weight reduction. JFE Steel developed a 980 MPa grade ultra-high strength cold-rolled steel sheet with excellent press-formability that satisfies both high elongation and stretch-flangeability, which had been difficult with conventional ultra-high tensile strength materials.

In the field of building construction materials, Nippon Steel & Sumitomo Metal developed a new “High strength bearing wall,” in which a burring processing is applied to high corrosion resistance galvanized steel sheets, and “Joining hardware” using iron-based cast steel parts, and is progressing steadily toward the construction of the first 4-story steel-structured housing in Japan. Nisshin Steel developed laser welded lightweight H-shape steel and began commercial production in April 2015. In comparison with high frequency welding, laser welding of this lightweight H-shape steel enables deep penetration in a narrow weld width, making it possible to obtain a small cross-sectional shape which is not available in conventional shape steels. Because it is possible to obtain small cross-sectional shapes that are not available with conventional steel shapes, gauge reduction is also possible, and high corrosion resistance hot dip Zn–Al–Mg alloy steel sheets are used as the base material, this product offers a variety of outstanding features, including excellent corrosion resistance and applicability to a wide range of uses, beginning with various types of structural members such as structural materials for prefabricated housing, steel frame structures, etc.

2.4.2. Plates

Nippon Steel & Sumitomo Metal was the world’s first steel maker to receive approval from the DNV GL ship classification society for BCA and CTOD steels for mega container ships. These high strength, heavy gauge steel plates possess a combination of brittle crack arrest (BCA) characteristics, by which a crack is arrested even if it is initiated in a plate, and brittle crack initiation characteristics (CTOD: crack tip opening displacement characteristics), which prevent cracks from penetrating steel plates as such. JFE Steel realized a low yield ratio in the TS 780 MPa class TMCP steel plate for building structures in an online production process for the first time by applying state-of-the-art TMCP technology. This resulted in the development of a high strength, heavy gauge steel plate for building structural use which not only shortens delivery lead times, but also possesses excellent weldability.

2.4.3. Bars and Wire Rod Material

Diado Steel’s Hoshizaki Plant constructed a quality assurance system corresponding to the NORSOK standard (global manufacturing standard for materials for the petroleum and gas industries), including optimization of heat treatment control and product testing, etc., and received NORSOK certification for round dual-phase stainless steel bars.

2.5. Environment and Energy

2.5.1. Government Efforts

The 21st session of the Conference of the Parties to the UNFCCC (COP21) and the 11th session of the Conference of Parties serving as the Meeting of the Parties to the Kyoto Protocol (CMP11) was held in Paris, France from November 30 to December 13, 2015.20)

At this meeting, the Paris Agreement was adopted as a new framework. The Paris Agreement contains the following points.

• Mentions not only 2°C but also 1.5°C as a long-term common global target.

• Submission and revision of reduction targets by all countries, including major emitters, every 5 years, reporting of the condition of implementation by common and flexible methods, and review.

• Positioning of application of market mechanisms, including the bilateral Joint Crediting Mechanism (JCM).

• Importance of preserving and strengthening forests and other carbon sinks, and efforts to prevent emissions due to reduction and deterioration of forests in developing countries.

• Setting of long-term adaptation targets, adaptation planning programs of each country and implementation of actions.

• Continuing provision of funding by developed countries, and voluntary contributions by developing countries.

• Positioning of the importance of innovation.

• Mechanism for grasping global condition at intervals of 5 years.

• Uses the number of countries and emission amounts in requirements for entry into force of the Agreement.

• Mentions the “Sendai Framework for Disaster Risk Reduction” (COP decision).

2.5.2. Efforts of the Japanese Steel Industry

The Japan Iron and Steel Federation (JISF) established a “Voluntary Action Programme for the Iron and Steel Industry” and has carried out efforts with the following targets.

(1) Assuming annual crude steel production of 100 million tons, achievement of a 10% reduction of energy consumption in iron and steel processes by FY 2010 compared with the baseline year, FY 1990.

(2) Achievement of the above-mentioned target as an average value for the 5-year period from FY 2008 to FY 2012.

The JISF summarized the results of the Voluntary Action Programme in December 2013, and reported that the actual average value for the targeted 5-year period was a reduction of 10.7%, and thus achieved the target of the Programme.21) Furthermore, CO2 emissions were reduced by 10.5% in comparison with FY 1990.

In January 2013, the “Low Carbon Society Action Plan” was adopted. As the reduction target for 2020 in the activities of domestic companies, the steel industry is making ongoing efforts to improve energy efficiency in iron and steel processes, which is already on the world’s highest level, targeting a “reduction of 5 million tons-CO2 from the CO2 emissions assumed for various production volumes, i.e., business-as-usual (BAU) emissions, based on the maximum use of the most advanced technologies.” As the result of efforts under this “Low Carbon Society Action Plan” in FY 2014, BAU emissions were 186.44 million tons-CO2 against crude steel production of 106.51 million tons in FY 2014 as the total production of companies participating in the Low Carbon Society Action Plan. (The total crude steel production of the Japanese steel industry for the year was 109.84 million tons.) The CO2 emissions corresponding to this production volume were 187.45 million tons-CO2. From this, the actual reduction from BAU emissions was +1.01 million tons-CO2, or +6.01 million tons-CO2 in comparison with the target. Thus, the actual results for FY 2014 exceeded BAU. Although steady progress is being made in improvement of coke oven efficiency, achievement of higher efficiency in power generating equipment, strengthening of energy saving, and other areas, this result was due to various factors which increased emissions, such as changes in the demand structure which were not foreseen when the target was established, deterioration of refractory bricks in coke ovens, etc.22)

In the development of innovative technologies, COURSE50 (CO2 Ultimate Reduction in Steelmaking Process by Innovative Technology for Cool Earth 50) has been underway since FY 2008 with the aim of reducing CO2 emissions by approximately 30%. This is to be achieved by reducing CO2 emissions from the blast furnace and separation and recovery of CO2 from blast furnace gas. Step 1 of Phase 1 was completed in FY 2012, and development under Step 2 of Phase 1 began in FY 2013 with a 5-year timeframe. Efforts in Step 2 include a) as technology for reducing CO2 emissions from the blast furnace, construction of a 10 m3 scale test blast furnace, comprehensive verification of the results of study at the laboratory level in Step 1, establishment of a reaction control technology for maximizing the effect of hydrogen reduction, and collection of data for future upscaling of the process, and b) as technology for separation and recovery of CO2 from BF gas, development of a high performance liquid chemical absorbent, etc., achievement of higher efficiency in the physical adsorption method, research on adaptation of technologies for utilizing currently-unused waste heat, and construction of a lower cost technology, in order to develop a technology that can be matched with the pilot test blast furnace and enables CO2 separation and recovery at a cost of ¥2000/ton-CO2. Construction of the 10 m3 scale test blast furnace was completed at Nippon Steel & Sumitomo Metal Kimitsu Works in September 2015, and trial operation began, aiming at actual experiments in 2016.22)

For effective utilization of waste plastics as part of the above-mentioned Low Carbon Society Action Plan, the JISF is targeting use of 1 million tons/year of waste plastics, etc., preconditioned on the establishment of a collection system by government entities.22) In March 2015, Nippon Steel & Sumitomo Metal Wakayama Works introduced equipment for addition of waste plastics (container and packaging plastics) to coke ovens. The system realizes effective utilization of substantially 100% of the charged waste plastics. Waste plastics are charged into the coke ovens and converted to chemical raw materials such as tar, light oil and other types of oil (approx. 40%), coke (approx. 20%) and coke oven gas, etc. (approx. 40%). Although Nippon Steel & Sumitomo Metal began recycling of container and packaging plastics in 2000, with the introduction of this system at Wakayama Works, the company now recycles waste plastics at all of its steel works which operate coke ovens.

As an example of the application of iron and steel slag to environmental remediation and environmental improvement, a bottom sediment improvement material using steel slag from JFE Steel as the raw material was adopted in the “Fukuyama Port – Port Waters Environment Creation Project (Inner Harbor District)” in Hiroshima Prefecture. As a countermeasure for bad odor in the back part of Fukuyama Inner Harbor, JFE Steel and Hiroshima University jointly carried out a field demonstration test in which a slag-based material was used to suppress the hydrogen sulfide odor from sludge-like bottom mud in those waters. The test confirmed various bottom sediment improvement effects, which included suppression of hydrogen sulfide generation, improvement of habitats of benthic organisms, etc. Based on these results, approximately 38000 tons of bottom improvement material were laid over an area of about 66000 m2 in Fukuyama Inner Harbor (Fukuyama City, Hiroshima Prefecture) between November 2015 and March 2016.

In the energy field, the Machinery Division of Daido Steel developed an electric furnace with rotation drive which solves the problem of non-uniform melting in circular 3-phase alternating current (AC) electric furnaces by rotating the furnace body, making it possible to reduce input energy. In November 2013, a 3-phase AC electric furnace with rotation drive was introduced at Daido Steel’s Chita Works. The furnace has a capacity of 150 tons, a steel door inner diameter of 7000 mm, an EBT tapping system, a transformer capacity of 120 MVA and a maximum furnace turning angle of 50°. In comparison with the conventional furnace without turning, this technology realizes improvements of 2.6% in thermal efficiency, 4.1% in unit input energy and 6.1% in power-on time.

Japan Casting & Forging Corporation established a production system for COST-FB2 rotor material for steam turbines of ultra-supercritical (USC) pressure thermal power plants. The cobalt- and boron-containing high chromium heat resistant steel COST-FB2 has been adopted as a material for rotor shafts of steam turbines when the steam temperature exceeds 600°C. However, in the manufacture of rotor shaft materials, which are both large in scale and used under severe conditions, high cleanliness and homogeneity are required in order to ensure the soundness of the product. Using the 145 ton ESR equipment introduced in 2012, Japan Casting & Forging has manufactured a large number of large-scale COST-FB2 rotor shaft materials, beginning with a delivered weight of 50 tons, and delivered a total of 20 shafts in 2015. The company also developed a manufacturing technology for ultra-heavy gauge forged steel products of high nitrogen stainless steel for the International Thermonuclear Experimental Reactor (ITER). It is generally difficult to secure the internal quality (transmissivity in ultrasonic inspection, mechanical properties) of ultra-heavy gauge steel castings and to forge products to a rational near-net shape. To solve these problems, the company developed a grain refinement forging technology and a hot bending forming technology which enable production of products for the actual machine.

3. Technology Trade and Development

3.1. Technology Trade

Figure 8 shows the transition of the balance of technology trade in the iron and steel industry up to FY 2014. Payments received for technology exports decreased by 41% from the previous fiscal year, and payments for technology imports decreased by 24%.23)

Fig. 8.

Balance of technology trade of steel.23)

3.2. Research Expenditures and Number of Researchers

The following three items were arranged using the data in Table 3, Research activities in companies in the statistical tables in the outline of the results of the “Statistical Survey of Researches in Japan” published by the Statistic Bureau, Ministry of Internal Affairs and Communications. The results are shown in Figs. 9, 10, 11.23)

Fig. 9.

Trend of ratio of R&D expenditures to sales.23)

Fig. 10.

Trend of the number of researchers per 10000 employees.23)

Fig. 11.

Trend of R&D expenditure per researcher (10 M yen/person).23)

[Ratio of Research Expenditures to Sales]

In all industries, this item has been essentially flat for the last 4 years. In the steel industry, there was a slight increasing tendency during the last 2 years, following a temporary decrease in FY 2012.

[Number of Regular Researchers per 10000 Employees]

In both all industries and the steel industry, an increasing tendency continued until FY 2011. In FY 2014, a drop similar to that in FY 2012 could be seen in both groups.

[Research Expenditures per Regular Researcher]

In FY 2014, the index for all industries had not recovered the level of FY 2008 before the global financial crisis triggered by Lehman Brothers’ bankruptcy, but nevertheless showed an increasing tendency. The steel industry achieved a large increase in comparison with FY 2013 and returned to the level of FY 2008.

3.3. Trends in Research and Development Utilizing Public Funds

Among iron and steel-related technical development projects, the NEDO project “Development of Technologies for Hydrogen Production, Delivery, and Storage Systems” was completed in FY 2014. No new projects were begun during FY 2015.

The main continuing projects were i) MEXT: “Heterogeneous Structure Control: Towards Innovative Development of Metallic Materials” (FY 2010–2019, managing organization: JST), ii) METI: “CO2 Ultimate Reduction in Steelmaking Process by Innovative Technology for Cool Earth 50 (COURSE50) Step 2” (FY 2013–2017, managing organization: NEDO), iii) METI: “Development of Innovative Structural Materials Technology” (FY 2013–2022, budget for FY 2015: ¥5.92 billion), iv) Cabinet Office, Japan: (“Structural Materials for Innovation” of “Strategic Innovation Promotion Program” (SIP) (FY 2014–2018, managing organization: JST), etc.

The main projects on iron and steel-related research and development topics being carried out with public funds are shown in Table 2. Many of these topics are in the fields of processes, the environment and energy and materials development.

Table 2. Examples of R&D topics with public funding in iron & steel industry.
CategoryProjectSource of funds and commissionFiscal year startedFiscal year ending
ProcessCO2 Ultimate Reduction in Steelmaking Process by Innovative Technology for Cool Earth 50 (COURSE50), Step 2NEDO20132017
Strategic Energy Technology Innovation ProgramNEDO20142016
Elemental
technology
Grants-in-Aid for Development of Element Technologies for Practical Application of Advanced Ultra-Supercritical (A-USC) Thermal Power GenerationMETI20082016
Heterogeneous Structure Control: Towards Innovative Development of Metallic MaterialsJST20102019
Development of Core Technology for Next-generation 10 MW Grade Ocean Thermal Energy Conversion PlantNEDO20112015
Elements Strategy Initiative (Research Center Creation Type) for Structural MaterialsMEXT20122021
Zero-Emission Coal-fired Power Plant Technology Development ProjectNEDO20142017
Strategic Innovation Promotion Program (SIP): Structural Materials for InnovationCabinet Office20142018
ProductsTechnology Development Project of Advanced Ultra-Supercritical (A-USC) Thermal Power GenerationMETI20082016
Development of Magnetic Materials for High Efficiency Motors for Next-generation AutomobilesMETI20122016
Development of Innovative Structural Materials TechnologyMETI20132022
R&D Project on Hydrogen Energy Utilization TechnologyNEDO20132017
OthersTechnological Development for Next-Generation 3-D Printers for Industrial UseMETI20142018

4. Development of Human Resources in Technical Fields

The Iron and Steel Institute of Japan (ISIJ) conducts corporate human resource training programs (Iron and Steel Engineering Seminars, Iron and Steel Engineering Seminar special courses, Advanced Iron and Steel Seminars) and human resource training programs for students on an on-going basis for the purpose of developing cross-industry human resources.

The ISIJ has conducted “Student Iron and Steel Seminars” for many years as human resources development of students. Since FY 2011, the ISIJ has also held the “Introduction to Iron and Steel Engineering Seminar” for master’s level graduate students and the “Experiential Seminar on Advanced Iron and Steel” for undergraduates. The “Introduction to Iron and Steel Engineering Seminar” is a 3.5 day course consisting of lectures on the fundamentals of iron and steel engineering and technical development at the site by teachers from universities and companies, and a plant tour on the final day (in FY 2015, Nippon Steel & Sumitomo Metal’s Wakayama Works). In FY 2015, 23 students from 11 universities participated. The “Experiential Seminar on Advanced Iron and Steel” is a 1-day seminar which comprises an introduction to iron and steel-related technology and the outlook for the future as well as a plant tour. This seminar was held at four locations, Nippon Steel & Sumitomo Metal’s Kimitsu Works, Kobe Steel’s Kakogawa Works, Daido Steel’s Chita Works and Nippon Steel & Sumitomo Metal’s Muroran Works; a total of 78 undergraduates participated.

“University Special Lectures by Top Management” by members of the top management of steel companies were held at 10 universities, and Special Lectures on Iron and Steel Technology” by speakers from METI and companies were held at 12 universities. A total of approximately 2000 persons attended these events. As another program, the ISIJ is continuing to support the cost of bus transportation for steel works tours planned by universities.

5. Technology Creation Activities in the ISIJ

The ISIJ conducts activities in which it surveys technical information related to iron and steel production technologies, identifies issues for technology development and works to solve those issues, centering on Technical Committees and Interdisciplinary Technical Committees, which are affiliated with the Technical Society.

5.1. Technical Committees

Technical Committees, which promote activities in designated fields related to iron and steel production, hold regular Committee Meetings, where key issues at the present point in time are energetically discussed as common/important topics. In FY 2015, 35 Committee Meetings (17 Spring Meetings, 18 Fall Meetings) were held, which was an increase of one from FY 2014. The total number of participants was 2744 (including 71 researchers from universities, etc., an increase of 3 from FY 2014). The total number of participants was approximately the same as in FY 2014, when 2724 persons participated.

Collaboration with the ISIJ’s Academic Division has also taken firm root. The Technical Committees encourage exchanges in the form of participation by university researchers in Committee Meetings and programs for training young persons, joint programs with the Academic Division, etc.

International exchanges activities are also continuing to increase, including participation in international conferences, surveys of technology in other countries, tours of plants, etc. and other activities, depending on the Committee.

In the Technical Committee, where joint studies of designated technical problems are carried out as priority issues, activities were carried out on 20 themes.

It may also be noted that an increasing number of Technical Committees are planning new lecture meetings for young engineers and plant tours/lecture meetings with other industries, which are also on-going activities from earlier years.

5.2. Interdisciplinary Technical Committees

Interdisciplinary Technical Committees study interdisciplinary and inter-industry technical issues, in principle with a 3-year timeframe. In FY 2015, the Interdisciplinary Technical Committee “Improvement of reliability of practical structural steels” concluded its activities and issued a report.

The Interdisciplinary Technical Committee on “Desirable steel materials for automobiles” conducted plant tours, submitted topics to the Society of Automotive Engineers of Japan (JSAE), etc. as it continued to explore the proper form of a new cooperative relationship with auto makers.

In the Interdisciplinary Technical Committee on “Pressure vessel materials,” the “Working Group on Study of Standards for Steel Materials,” “Working Group on Evaluation of Hydrogen Embrittlement of Steel Materials for Chemical Plants” and “Working Group on High Strength Heat-Resistant Steels” carried out survey research, experimental research, etc. in their respective areas, continued from FY 2014.

5.3. Research Grants and Research Groups

In “Grants for Promotion of Iron and Steel Research,” 36 new projects (including 11 by young researchers) were selected as grant recipients beginning in FY 2015. Together with the 35 projects which began in FY 2014, a total of 71 projects were carried out with the support of this program.

In FY 2015, 18 Research Groups were active, of which five concluded their activities during the fiscal year. During the year, six new activities were begun in each of Research Group I (mainly basic and leading themes based on seed technologies possessed by universities) and Research Group II (mainly applied and industrial themes responding to the needs of companies), and 5 new activities in Group I and 3 new activities in Group II were selected for FY 2016. In “Industry-originated Project Development Iron and Steel Research,” the topics selected during FY 2013 were concluded at the end of March, and one new theme which was selected during FY 2015 is currently in progress.

References
 
© 2016 by The Iron and Steel Institute of Japan
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