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Steel: Major types and uses - Views on News from Equitymaster
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  • Sep 17, 2010

    Steel: Major types and uses

    In this article, we will take a look at the various types of products made by steel makers and their major applications. We will also identify the key end-users of the commodity in terms of sectors.

    The types of steel products

    Steel makers primarily produce three types of steel products: flat products, long products and stainless steel. The mother product in flats is slabs, from which sheets or plates are produced. The mother products in longs are blooms and billets, from which bars, rods and structural shapes are rolled.

    Flat Products

    Slabs: They are semi-finished steel products. They are obtained by the continuous casting of steel or rolling ingots on a rolling mill and cutting them into various lengths. They are used as a starting material in the production process of other flat products.

    Hot-Rolled Sheets: Hot rolling involves passing a slab through a multi-stand rolling mill to reduce its thickness to less than 12 millimeters. Hot-rolled sheets are used in non-surface applications like automobile suspension arms, frames, wheels, and other unexposed parts in auto and truck bodies, agricultural equipment, construction products, machinery, tubing, pipes and guard rails.

    Cold-Rolled Sheets: Cold-rolled sheets are hot-rolled sheets processed through an acid bath that removes scaling from steel's surface, and then passed through a rolling mill without reheating until the desired thickness is achieved. They can be further treated to achieve uniformity, ductility and various surface finishes and textures. They are used in surface applications like exposed automobile and appliance panels. They are usually coated or painted before sale to an end-user. Prices of cold-rolled sheets are higher than the prices of hot-rolled sheets.

    Coated Sheets: They are cold-rolled steel that have been coated with zinc or aluminum for corrosion-resistance and paintability. They are also the highest value-added sheet products because they require the greatest degree of processing and have the strictest quality requirements. They are used in exterior applications such as automobile chassis, household appliances, roofing and siding, heating and air conditioning equipment, air ducts and switch boxes, as well as in certain packaging applications, such as food containers.

    Plates: They are produced by hot-rolling reheated slabs. They are used as a structural material for bridge construction, storage vessels, tanks, shipbuilding, line pipe, industrial machinery and equipment.

    Long Products

    Billets and Blooms: They are semi-finished steel products. Blooms are basically larger billets. They are obtained by the continuous casting of steel or rolling ingots on a rolling mill. They are used as a starting material in the production process of other long products.

    Bars: They are rolled from billets. Merchant bar and reinforcing bar (rebar) are two common categories of bars. Merchant bars include rounds, flats, angles, squares, and channels that are used by fabricators to manufacture furniture, stair railings, and farm equipment. Rebar is used to strengthen concrete in highways, bridges and buildings.

    Special Bar Quality (SBQ) Steel: SBQ steel is the highest quality long product. It typically requires customer approval for strength, life and other engineering parameters and is generally sold under contract to long-term customers. It is used in safety-critical applications such as axles, crankshafts, transmission gears, bearings and seamless tubes.

    Wire Rods:These ring-shaped coils. They are used in the automotive, construction, welding and engineering sectors.

    Wire Products: They are produced by treating wire rods with a series of dies to improve surface finish, dimensional accuracy and physical properties. They are used in fasteners, springs, concrete wire, electrical conductors and structural cables.

    Structural Sections: They are shapes produced in a rolling mill from reheated blooms or billets. They include wide-flange beams, bearing piles, channels, angles and tees. They are used mainly in the construction industry.

    Stainless Steel

    It is steel alloyed with carbon, chromium and even other elements such as nickel, molybdenum, titanium, niobium, manganese, nitrogen, copper, silicon, aluminum and vanadium. Stainless steel has properties like resistance to corrosion in highly aggressive elements, resistance to oxidation at high temperatures, toughness and ductility at very low temperatures, strength and ease in fabrication.

    Overall, the construction sector is the biggest user of steel. Within the construction sector, the residential segment accounts for nearly half the demand. Transportation, capital goods and infrastructure are the other large users of the commodity.

    Sector-wise steel consumption
    Sector Share
    Residential 22%
    Non-residential 9%
    Industrial 6%
    Infrastructure 13%
    Construction 50%
    Passenger cars 7%
    Trucks 6%
    Aviation, shipping & rail 3%
    Transport 16%
    Machinery 14%
    Metal products 14%
    Domestic appliances 3%
    Electrical equipment 3%
    Captial and consumer goods 34%
    Source: Equitymaster Research



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