Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

In a recent London Metal Exchange seminar, GFG Alliance Chairman Sanjeev Gupta spoke of how green technology will help the EU’s global steel and alumninum markets recover.


Innovations such as hydrogen steelmaking, use of solar and wind power, and better scrap utilization, are needed in the EU and UK’s heavy metals sectors, Gupta added. 


Issues in the EU and UK: 

According to Gupta, the three main issues that face the European and British metal industris are stagnant demand, overcapacity, and the rising cost of carbon emissions. Steel and aluminum manufacturing represent 10pc of global carbon emission today, Gupta added. With demand for these metals is slated to double in the next 30 years, net zero target dates won’t lag far behind, abetted by myriad countries agreeing to net zero emissions by 2050.



Aluminum consumption by certain industries, like automotive and aerospace, has grown by 7pc in the last 15 years, but production has concurrently declined by 20pc. In order to bridge the gap, carbon-heavy imports from China are compromising the EU’s emission-cutting goal. 


In order to bolster recovery in the aluminium sector, GFG Alliance aims to produce 1mn mt of primary aluminum a year by 2022 by focusing on developing Liberty’s Dunkirk’s aluminum smelter in Europe and ALVANCE’s British smelter, along with the hydro-power Lochaber smelter in Scotland. GFG is also working on a 1.2GW solar and wind farm in Spain to supply power to European smelters. 



Coal used in blast furnaces is one of the biggest emission contributors in the industry today. In order to mitigate emissions, using hydrogen to make steel instead of carbon is being touted because the only by product is water and carbon-dioxide is omitted. 


In Australia, where iron ore grade and reserves are high, Gupta plans to use solar power to make hydrogen steel by setting up a 280MW solar farm at GFG’s Whyalla Steelworks in Western Australia, which will be scaled to 3GW and would be the largest facility of its kind in the world. 


In the UK, about 10mn mt of scrap is generated annually, of which 80pc is subsequently exported. GFG intends to modernize its electric arc furnaces to use renewable energy and set up a new EAF at Liberty Newport in order to give the region recycling capabilities that will help meet its annual 15mn mt consumption, largely from scrap recycling. 


In order to remain competitive in the global market, Gupta believes that European countries should undertake three steps—industry consolidation, collaboration on technology development costs and policy oriented toward incentivising green steel and aluminum production and consumption.

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