Analysis of market, cost and locational factors for green iron and steel in Australia

The Challenge

Iron and steel production contributes over 7% of global CO₂ emissions. While demand for green alternatives is rising, high costs and uncertain market support for low-carbon processes remain major barriers.

Key Findings

This project assessed location factors, scrap availability, and market dynamics to clarify future iron ore needs. It will:

• Strengthen strategic insights into green steel markets
• Valuable policy for a viable Australian green steel industry
• Established a foundation for future HILT research and modelling

Local Factors

Most important:

• availability & cost of RE
• proximity to facilities

Also important:

• Regulation & policies
• Ore types
• Transport infrastructure
• H2 storage/transport costs

Least important:

• labour costs
• current production setup

Scrap Availability

Steel scrap recycling and remelting plays a vital role in the overall decarbonisation strategy of iron and steelmaking if shifting from BF-BOF route to EAF route pathways is to be taken.

The project work reveals that approximately 4 million tonnes of steel scrap were recovered annually in Australia, and that on average, Victoria and New South Wales together contribute about 63% of the total. Between 2016 to 2020, roughly half of steel scrap originated from Municipal and Solid Waste collection while 30% and 20% originated from Construction and Demolition, and Commercial and Industrial sources, respectively. Roughly 2 Mt of scrap was utilised locally, and the other 2 Mt was exported overseas with Bangladesh, Vietnam, and Indonesia the top three export destinations

Market Dynamics

Share of steel demand that is green expected to rise from 18%-46% in 2030 to 41%-76% in 2050.
Regional demand for green steel led by China, followed by Europe, North America, and Southeast Asia.
Benchmarking uncovers scenarios with significant projected shortfalls in regional supply of green steel particularly in China.
Demand for primary green steel in the automotive industries led by China, followed by JKT.

Benefits to WA

Understanding global green iron markets will help WA producers align with downstream investors, enabling local processing technologies and boosting Australia’s competitiveness in low-carbon steel exports.

Financial Assistance DOI

DOI: 10.71342/845420259982