An iron curtain for global development?

Environmental Science and Technology has an interesting paper that explores iron use and stocks in developed and developing countries.

The paper looks at iron, one of the essential enabling materials for economic development, from  both an energy and therefore greenhouse gas perspective, and explores the possibility of depletion should all countries attempt to reach the same level of iron use as developed countries. Luckily, the data suggests that developed countries have or will reach a plateau (on a per capita basis) of ~10 tonnes. However should all countries aspire to this goal then known global iron stocks are insufficient.

Developed countries now have enough processed  iron stocks in existing infrastructure that they are able to meet a large portion of present iron demand by recycling the existing stock.

Africa, as a continent, is out of luck. The map below shows that the continent does not have enough reserves to use iron to the same per capita levels as developed countries, and it has not accumulated sufficient stocks to grow or maintain economic activity at the levels of developed nations.

Patterns of Iron Use in Societal Evolution

Daniel B. Moller, Tao Wang, and Benjamin Duval

Environ. Sci. Technol., 2011, 45 (1), pp 182–188

Abstract

A dynamic material flow model was used to analyze the patterns of iron stocks in use for six industrialized countries. The contemporary iron stock in the remaining countries was estimated assuming that they follow a similar pattern of iron stock per economic activity. Iron stocks have reached a plateau of about 8−12 tons per capita in the United States, France, and the United Kingdom, but not yet in Japan, Canada, and Australia. The global average iron stock was determined to be 2.7 tons per capita. An increase to a level of 10 tons over the next decades would deplete about the currently identified reserves. A subsequent saturation would open a long-term potential to dramatically shift resource use from primary to secondary sources. The observed saturation pattern implies that developing countries with rapidly growing stocks have a lower potential for recycling domestic scrap and hence for greenhouse gas emissions saving than industrialized countries, a fact that has not been addressed sufficiently in the climate change debate.

 

The massive growth of global material use over the past years, particularly due to the rise of emerging market economies, has revived questions about the long-term prospects and sustainability of resource use and the possibilities to reduce energy use and to mitigate greenhouse gas emissions associated with their production. The iron and steel industry, for example, accounts for about 6% of global final energy use and about 6−7% of global anthropogenic carbon dioxide emissions. An effective way to reduce resource depletion, waste generation, energy use, and environmental impacts associated with resource use is to reuse products or components or to recycle scrap. Efforts to reduce these impacts in the medium- and long-term should therefore be informed by models that are capable of explaining and anticipating resource use and scrap availability.

Traditional resource models and are often based on the Environmental Kuznets curve (EKC), which hypothesizes that the relationship between per-capita income and environmental indicators has an inverted U-shape. Applied to resources, the hypothesis implies that the intensity of resource use (IU)—defined as the ratio of physical material use per income—grows rapidly in initial stages of industrialization, but eventually falls as income rises further.

The limitations of EKC-based resource models have been discussed widely and include the following: (i) EKC models are based on statistical correlation, lacking a systems perspective capable of explaining the mechanisms that shape the IU and other important variables in resource cycles, such as scrap flows or mine production; (ii) they implicitly assume that resource cycles are driven by production (flow from process 7 to process 8 in Figure 1) and tend to neglect the stocks of different service-providing product categories; (iii) they lack robustness, because IU is an abstract ratio of two flow variables that tends to fluctuate…

We propose here an alternative based on patterns of in-use stock evolution.

Iron is by far the most important metal used by man in terms of quantity and environmental impact. The trend in raw steel production over the past decades (Figure 2) shows two important phenomena: (i) industrialized countries experienced a similar pattern—a strong growth, followed by a slack (with different distinctness) and stabilization on a high level; (ii) the current level of steel production per capita varies by a factor of 4−5 among the countries shown here (U.K. ca. 200 kg/a, Japan ca. 900 kg/a).

A recent study demonstrates that the per-capita iron stock in use in the U.S. … reached a plateau around 1980.

Fig 2 (reproduced from ES&T) Crude steel production 1900−2008: total production (top) and production per capita (bottom).

ACFB = Australia+Canada+France+United Kingdom; metric tons.

[Is] this apparent saturation … a transient phenomenon limited to the U.S., or [does] it [reveal] a more fundamental pattern of iron use in the path of a country’s development?

This implies the hypothesis that per-capita iron stocks in use indicate the level of industrialization:

they are negligible in agrarian societies,

they increase with industrialization, and

they remain on constant, high levels during transitions from industrialized to information or service-based economies.

Should this iron saturation hypothesis be supported by further research, patterns of iron stock evolution observed in industrialized countries could be used as benchmarks for emerging market economies and thereby provide a more solid basis to inform policies on long-term steel demand, scrap generation, and energy demand and emissions related to their production.

Fig 3. (reproduced from ES&T) Per capita iron stocks in use versus per capita GDP PPP.

The decomposition of the total iron stock indicates further similarities: all of the investigated countries employ most of the iron in Construction, followed by Machinery and Appliances, Transportation, and Others. Furthermore, the per-capita iron stocks are fairly similar for Machinery and Appliances (from 2 tons in France to 3 tons in Canada), Transportation (from 1 ton in U.K. to 2 tons in U.S.), and Others (from 0.3 to 0.6). However, there are large differences in the amount of iron employed in Construction (from 2.5 tons in France to 9−10 tons in Japan).

There are some interesting differences noted by the authors.

France reached saturation in per capita iron use in 60 years whereas Japan reached the same level of iron use in 20. Smaller countries tend to use less iron per capita than larger countries, but Japan uses significantly more. The authors speculate on the increased use being due to the earthquake prone nature of the country, the increased use of high rise construction and the hot humid climate. Both Canada and Australia have not reached per capita saturation and deploy more per capita than the UK and France (Canada more than the US). This may be due to the recent growth in  mining, processing, and transportation of ores and materials for export. Iron stocks in use tend to start growing at per capita incomes of $US1000 - $4000.

Global iron stocks in the ground (reserves) are estimated to be 79 Gt or 12 t/cap  (Figure 5 top). The largest iron stocks in reserves are found in Brazil (16 Gt), Russia (14 Gt), Ukraine (9 Gt), Australia (9 Gt), and China (7 Gt). In terms of per capita iron stocks in reserves, Australia (440 t/cap) leads before Sweden (240 t/cap), Kazakhstan (220 t/cap), and Ukraine (190 t/cap). Although China and India have substantial iron reserves in absolute terms, their large population leads to small per capita reserves (China 5 t/cap and India 4 t/cap).

In contrast, the global iron stocks in use have reached about 18 Gt or 2.7 t/cap, which is about 23% of the amount of the global reserves (Figure 5 bottom). The largest absolute in-use iron stocks are found in the U.S. (3.2 Gt), followed by China (2.2 Gt), Japan (1.7 Gt), Germany (0.7 Gt), and Russia (0.7 Gt). On a per-capita basis, Japan and Canada (12 t/cap) lead in front of the U.S. (11 t/cap). Although China’s per capita iron stock (2.2 t/cap) is only about 20−25% that of industrialized countries, due to its large population, it constitutes the second largest iron stock in use. India, which has a similar population multiplier, has about five times smaller iron stocks (0.4 t/cap) than China.

 

Fig 5 (reproduced from ES&T) Density-equalizing maps of iron stocks in 2005 in ore reserves (top) and in use (bottom).

The interesting thing to note in this map is that whereas the US has “depleted” its reserves on a per capita basis (top) it has a large stock of iron in use on which to draw (bottom). The same is true of Western Europe. South America has large reserves on which to draw as it develops. China appears to be half way through its iron accumulation phase (if the model is valid) and it is fairly obvious from which reserve it draws. The race between India and China starts with China looking down the home straight.

Africa has drawn the short straw. Per capita reserves are generally low and the continent has not accumulated significant stocks. If the estimated global reserves presented in this paper are correct, then Africa will not reach the same levels of development as other nations… at least not using iron.

Africa, India and Indonesia may struggle to reach there respective development goals, unless they get there acts together post-haste. What are they going to trade to accumulate the iron they need? Can they outbid China or the energy rich central Asian countries?

The decreasing IU for steel observed for many industrialized countries …could be explained by a tendency for per-capita iron stocks to flatten off at a certain point while GDP remains growing. Speculations about an absolute decoupling in steel demand, however, cannot be supported by this study: none of the analyzed countries shows a shrinking per-capita iron stock in use, which would be needed for long-term absolute decoupling of steel demand. Given the stock patterns observed, a more plausible scenario is that postindustrial societies still need to maintain and replace substantial iron stocks in use.

The observed stock patterns demonstrate that the opportunities for recycling and therefore for reducing resource depletion and GHG emissions change dramatically during a country’s evolution. The potential for recycling domestic scrap is very low in emerging market economies where stocks are growing rapidly, while industrialized countries can benefit from stocks … built up earlier.

The concept of a circular economy remains an illusion for emerging market economies.

Assuming the global population and its iron stock in use stabilize, the amount of iron units exiting the use phase would be as large as the amount of iron units entering use. It is therefore possible to envision a system of iron and steel management that is entirely based on secondary resources, using the built environment as the key mine of the future. Such a scenario would not only avoid primary resource exploitation and mining wastes (tailings), but it would also significantly reduce energy consumption and greenhouse gas emissions in the iron and steel industry, mainly because the most energy- and CO2-intensive process, the blast furnace, could be avoided.

The authors close with cautions about over extrapolating these results. The style of economic development could change (eg less car use, rethinking priorities) and other materials may replace some of steels uses. However, the fundamental role that iron has played, and continues to play in current industrialization and development can not be ignored and needs to be considered in the areas of both climate and developmental policy.