Société Internationale Métallique plans to produce the highest quality and most reliable Virgin Iron Units (VIU) in the form of Hot Briquetted Iron (HBI) for the iron-making and steelmaking industries in North America and around the world. We will pursue our business goals while respecting the environment and local communities.
After shrinking in the immediate aftermath of the 2008-09 financial crisis, and then accelerating rapidly in the early years of this decade, steel demand is currently steady, modest growth is being experienced, and expansion is expected to continue. Concurrently, the raw material quality standards of steelmakers are increasing, creating a need for innovative sourcing solutions that respond more effectively to their procurement needs.
The above factors suggest the existence of a particularly strong ongoing demand for HBI, a premium intermediate product used in making high-grade steel. HBI possesses distinguishing characteristics such as high iron content, low levels of impurities, and efficiency of handling when shipped in bulk. Our international market assessments indicate a new HBI opportunity of between 5 and 13 million MT annually, with SIM’s addressable market share conservatively estimated to be 7 million MT annually.
Market factors auguring strongly in favor of SIM’s Bécancour project include:
- Increased demand for high-strength, lower-weight steel, particularly in the automotive sector
- Recent new HBI projects, at other sites, have focused on satisfying the internal supply chains of certain sponsoring steelmakers, without catering to the expanding demand for HBI sought by other steelmakers within North America and internationally, on an untied merchant basis
- Globally, existing merchant HBI capacity has diminished because of chronic political instability and production inefficiencies in historical large-volume supplying nations such as Venezuela and Libya
- Growing scarcity and declining quality of traditional iron inputs, such as steel scrap, which steelmakers in the U.S. and Canada, and overseas, have previously relied on
- Carbon emissions when using HBI in the steelmaking process are significantly lower than when employing other sources of basic iron units, particularly in conventional blast furnaces
SIM’s facility will be one of the highest-capacity HBI plants in the world. It will position the province of Quebec, and Canada, prominently in the global ranking of producers of HBI (and HBI’s simplified companion product, direct reduced iron – or “DRI”). As the global market currently stands, Canada would become the 6th–largest combined producer of DRI and HBI in the world, with about 75% of the national output emanating from Quebec alone.
Source: Midrex, 2015 World Direct Reduction Statistics