In this article, we are going to discuss the 16 largest pig iron producing countries. You can skip our detailed analysis of the manufacturing of pig iron, the impacts of Covid-19 and the Russia-Ukraine war on the global pig iron supply chains and current market trends and go directly to 5 Largest Pig Iron Producing Countries.
Iron is the least expensive and most widely used metal in the world. Pig iron, or crude iron, is an intermediary good that is produced by smelting iron ore or scrap iron, with coke in a blast furnace or an electric arc furnace. On the other hand, cast iron is the purest form of iron. Cast iron contains only 3% carbon while the carbon content of pig iron is around 4%. Pig iron is hard and brittle and also has other impurities, such as sulphur, manganese, silicon and phosphorus mixed into it, while cast iron contains no impurities and can be cast into any shape.
Pig iron, while not very useful on its own, is used as a raw material for manufacturing steel. The difference lies in the percentage of carbon present. Those irons that have a carbon content of less than 2% are called steels. Pig iron was not produced in Europe until the Middle Ages, but China was producing it as early as 256 B.C.
According to a report by the United States Geological Survey, the World Steel Association forecasts a decrease of 2.3% in the global consumption of steel in 2022, followed by a 1% increase in 2023. This decline in 2022 was mainly related to events affecting consumer demand, such as the Russia-Ukraine conflict, the continuing Covid-19 mitigation measures in China, rising energy costs and interest rates, and inflation. This also led to a decrease in the global production of pig iron, with a total global production of 1.3 billion tons in 2022, while production stood at 1.35 billion tons in 2021, revealing a decline of 3.7% in the pig iron industry.
The Russia-Ukraine conflict has had a huge impact on the global pig iron trade. According to SteelMint, Russia and Ukraine together controlled a whopping 50% of the global trade of the metal in 2021, which stood at around $7.16 billion. However, following Russia’s aggression last year, pig production in Ukraine decreased by around 9.5%, mainly due to problems in logistics and energy supply, which is unstable due to constant Russian shelling.
On the other hand, following the conflict, the U.S. and other nations have imposed strict sanctions on Russia, which was the largest exporter of pig iron in 2021, but this changed significantly in the following year. Russia was the largest supplier of pig iron to the U.S. in 2021, with a volume of more than 2 million tons. However, in 2022, the U.S. only imported 637.9 thousand tons of the metal from the Russian Federation, and imports were only carried out from January to May. In April of 2023, the U.S. announced to impose a 70% tariff on pig iron imports from Russia.
The war caused an increase in the global pig iron prices due to supply chain issues but these have since settled down because of a lack of demand in world markets. A big reason for this is the economic conditions in China, which saw a 4% decrease in steel consumption in 2022, owing to extended Covid-19 mitigation strategies that led to decreased demand for real estate and construction sectors.
Photo by the blowup on Unsplash
Methodology:
The total production of pig iron in 2022 was around 1.3 billion metric tons and over 90% of this was produced by only 16 countries. Since pig iron is an essential raw material for producing cast iron and steel, these countries have been making hefty profits due to the virtual monopoly that they enjoy. For this article, we have referred to the reliable Mineral Commodities Summaries 2023 report by the United States Geological Survey, to rank these countries.
16. South Africa
Production of Pig Iron in 2022: 2.4 million metric tons
South Africa produced 17.5% less pig iron in 2022 as compared to 2021. This is mainly due to the inefficiency of the state-owned railway operator. Most of the iron ore and coal in the country is transported by rail and so producers had to hire trucks to transport raw material, leading to an increase in the cost of logistics. ArcelorMittal S.A. (NYSE:MT), with its subsidiary ArcelorMittal South Africa, is a key manufacturer in the South African iron and steel industry.
15. Mexico
Production of Pig Iron in 2022: 3 million metric tons
The production of pig iron in Mexico in 2022 remained unchanged from a year before in 2021. The two states that contribute majorly to pig iron production in the country are Michoacán and Colima. According to the Observatory of Economic Complexity, In 2021, Mexico exported around $23,000 worth of pig iron while importing about $135 million worth of it, hence making the country a net importer of the metal.
One of the key players in the Mexican iron and steel market is Ternium S.A. (NYSE:TX), through its subsidiary Ternium Mexico SA de CV. The company Ternium S.A. (NYSE:TX) is the leading steel company in Latin America, with production centers in Mexico, Brazil, Argentia, Colombia and some other countries. With a market cap of $7.52 billion, Ternium S.A. (NYSE:TX) employs over 21,000 people around the world.
14. Iran
Production of Pig Iron in 2022: 3 million metric tons
Iran, with its reserves in Kerman and Yazd provinces, also witnessed no difference in the production of pig iron from 2021 to 2022. A key player in the Iranian pig iron industry is the private Mobarakeh Steel Company. Located in the southwest province of Isfahan, this company is the largest manufacturer of steel in the entire MENA region (Middle East and North Africa).
13. Italy
Production of Pig Iron in 2022: 4 million metric tons
Italy imported about $678 million worth of pig iron for its steel industry needs in 2021, while the total pig iron exports were around $40 million, with the majority of these exports going to Austria. A big player in the Italian pig iron market is the steel manufacturer, ArcelorMittal S.A. (NYSE:MT), with its Italian subsidiary ArcelorMittal Italia SpA. ArcelorMittal S.A. (NYSE:MT) was formed in 2006, with the takeover and merger of Arcelor with the Indian-owned Mittal Steel.
12. Turkey
Production of Pig Iron in 2022: 10 million metric tons
Despite being one of the largest producers of pig iron in the world, Turkey remained the third-largest importer of the metal in 2021, with imports of $713 million, the majority of which came from Russia and Brazil, according to SteelOrbis. Based in the province of Zonguldak, Erdemir is the largest iron and steel manufacturer in the country.
11. Taiwan
Production of Pig Iron in 2022: 15 million metric tons
The total pig iron production in Taiwan remained the same in 2021 and 2022. Established in 1997 and based in Kaohsiung, Yieh Corp. is a key player in pig iron and steel manufacturing in Taiwan. According to the company, the pig iron imports in Taiwan in 2021 amounted to approximately 430,000 tons, a YoY increase of 119% due to the steel mills’ active purchase.
10. Vietnam
Production of Pig Iron in 2022: 15 million metric tons
Vietnam was a net importer of pig iron in 2021, with imports worth $38.5 million, majority of which came from South Korea. Thach Khe Iron Mine, located in central Vietnam, is an important reserve for the metal, but according to a report by VNExpress, the mine has stood abandoned since 2011 due to investment issues and environmental fears. The Hoa Phat Group (HGP) is an important player in the Vietnamese pig iron market.
9. Ukraine
Production of Pig Iron in 2022: 19 million metric tons
Ukraine produced about 21 million metric tons of pig iron in 2021, hence, the Ukrainian market witnessed a decline of around 9.5%. A big part of this decline is attributed to the ongoing Russia-Ukraine conflict. According to OEC, Ukraine was the third-largest exporter of pig iron with exports of $1.61 billion in 2021.
8. United States of America
Production of Pig Iron in 2022: 21 million metric tons
The US was the largest importer of pig iron in the world in 2021, with $2.93 billion of imports, 34% of which came from Russia. However, this number declined rapidly in 2022 due to the Russian aggression in Ukraine. Pig iron and raw steel are produced in the US by three companies operating integrated steel mills in 11 locations.
Large reserves of iron ore are found around Lake Superior, in the states of Michigan and Minnesota. The United States Steel Corporation (NYSE:X), founded in 1901, is an important player in the US market. Among the founders of the United States Steel Corporation (NYSE:X) are also the famed business tycoons Andrew Carnegie and J.P. Morgan. Headquartered in Pittsburgh, the United States Steel Corporation (NYSE:X) has over 24 thousand employees and a market cap of over $4.86 billion.
7. Germany
Production of Pig Iron in 2022: 24 million metric tons
Germany is the largest producer of pig iron in the EU, though production decreased by 7.7% from 2021, when it stood at 26 million metric tons. Germany still remained a net importer of the metal in 2021, with imports of $180 million, majority of which came from Brazil. Thyssenkrupp AG is an important player in the German iron and steel market, with a market cap of $4.09 billion.
6. Brazil
Production of Pig Iron in 2022: 26 million metric tons
As the largest producer of pig iron in South America, Brazil is also currently the largest exporter of the metal in the world. The country exported $1.69 billion worth of pig iron in 2021, majority of which went to the US. However, production in 2022 was around 7% less than in 2021, when it stood at 28 million metric tons. Brazilian iron ore is known to have high iron content and low cost and is widely available in the country. The largest company in the Brazilian iron and steel market is Gerdau, with ArcelorMittal S.A. (NYSE:MT) also having an important presence.
Click to continue reading and see the 5 Largest Pig Iron Producing Countries.
Suggested Article:
- 12 Biggest Iron Ore Producers in the World
- 15 Largest Steel Producing Countries in the World
- 15 Largest Potash Producing Countries in the World
Disclosure: None. 16 Largest Pig Iron Producing Countries is originally posted on Insider Monkey.