The global steel industry is starting to shift to "green" production as regulations tighten and consumer preferences change, Sebastian Langendorff, founder and CEO of Meranti Green Steel, said during an industry webinar attended by Callanish.
He explained that regulations such as the EU Carbon Boundary Regulation Mechanism (CBAM) and rising carbon taxes in Southeast Asia are pushing steel producers to reduce emissions. For example, the carbon tax in Singapore is planned to be raised to $45 per ton. 2026.
It is also changing consumer demands, especially in sectors such as automotive and construction, where low-carbon steel is becoming increasingly important.
One of the key components of "green steel" is direct reduction iron, which uses cleaner fuels such as natural gas or hydrogen. DRI needs high-quality iron ore with an iron content of 67-68%. Currently, DRI-based steel production accounts for only a small share of global steel production, but demand for it is expected to grow rapidly.
Steel scrap also plays a big role. About 800 million tons of steel are produced from scrap metal per year, and by 2050 this figure may grow to 1.5 billion tons. Nevertheless, the demand for iron ore-based steel will continue, especially in fast-growing regions such as India and Africa, Langendorf stressed.
Southeast Asia, which currently produces about 80 million tons of steel per year, could double its output by 2035. While most production still comes from traditional blast furnaces, signs of green demand for steel have begun to appear, for example, in the automotive industry and the construction sector in Singapore.
"Metallurgists are starting to go two ways," Langendorff said. "They are preparing to meet Europe's future demand for environmentally friendly steel, and are also gradually creating local environmentally friendly markets in Southeast Asia. The changes have begun, and the "green steel" is not going anywhere."
Aditi Tiwari, India
kallanish.com
