ND 183 Metallurgi ENG - Bergforskbergforsk.se/wp-content/uploads/2011/08/metallurgy_in_sweden.pdf10 An integral part of Innovative Sweden EU and elsewhere. Collaboration between Finland

Metallurgy– An integral part of Innovative Sweden

Produced by The Ministry of Industry, Employment and Communications, Sweden Pictures s 1 Stig-Göran Nilsson/Jernkontoret. Fagersta Stainless AB, Fagerstap 4 Per Murén/ NCC Roads ABp 6 Stig-Göran Nilsson/Jernkontoret. Fundia Special Bar AB, Smedjebackenp 8 Martin Sundström/NCCp 12 Stig-Göran Nilsson/Jernkontoret. SSAB Tunnplåt AB, Borlänge p 16 LKABp 18 Stig-Göran Nilsson/Jernkontoret. SSAB Tunnplåt AB, Luleåp 21-22 Stig-Göran Nilsson/Jernkontoret. Erasteel Kloster AB, Söderforsp 24 Jörgen Svendsen/Pressens bild. Boliden Minerals, Aitikp 26 Christer Kjellén/Stenutveckling Nordiska ABPrinting Danagårds grafiska Article No N6005

Contents

Preface 5

Introduction 7

Vision and strategies 9

Strategy programme 13

Business environment 17

Prospects for Sweden 19

The industries in brief 23

Strategy group and secretariat 29

4 An integral part of Innovative Sweden

5An integral part of Innovative Sweden

Preface

Thomas Östros Minister for Industry and Trade

The Government’s position on how to meet international competition is clear. Sweden will com-pete on the strength of its knowledge, innovation and renewal. We will not compete on the basis of low wages and poorer working conditions. We will continue to occupy a high position in the value chain and develop by focusing on high-tech solutions and international markets.

The role of the state is to create conditions that will enable Sweden to have the best research and education in the world, a stable economy, a first-rate business climate and an efficient innova-tion system. If Sweden is to maintain its successful record in the increasingly tough international competition prevailing in the global mellurgical industry, it is utterly crucial to develop condi-tions that are conducive to innovation, production and enterprise.

In June 2004 the Government presented its innovation strategy Innovative Sweden: A strategy for growth through renewal (Ds 2004:36). The strategy establishes a platform for strengthening Sweden as a knowledge nation. The vision is clear. Sweden is to be Europe’s most competitive, dynamic and knowledge-based economy and Swedish metallurgy is to be the most competitive in Europe.

In the 2004 Statement of Government Policy, the Prime Minister invited business representa-tives to a series of discussions in a number of industrial sectors, and work subsequently began on drawing up strategy programmes for these sectors. Effective dialogue between the state and the business sector is the foundation on which a modern industrial policy must build. This strategy programme for Swedish metallurgy is a further step in the series of programmes that began with the strategies for the aerospace and automotive industries and it will be followed by programmes for the IT/telecom, forestry/wood and pharmaceuticals/biotech industries.

The Swedish metallurgical industry is one of the country’s primary industries. By providing raw materials, technology and environmental expertise, metallurgy plays a major role in gener-ating employment and sustainable growth in all parts of Swedish trade and industry. By means of cooperation between the state and the business sector, government agencies and non-gov-ernmental organisations, we can improve the competitiveness of the metallurgical industry and promote Swedish welfare and prosperity.

We are therefore proud to present the strategy programme Metallurgy: a part of Innovative Sweden.

Ulrica Messing Minister for Communications and Regional Policy


Introduction

The industries included in the strategic programme for met-allurgy are the iron and steel industry, mines and smelting plants, the equipment industry and the industrial minerals, aggregates and dimensional stone (natural stone) industries. These industries are among Sweden’s primary industries. Their common denominator is that they all involve explora-tion and extraction of natural resources, which can be proc-essed so as to contribute to value-added and high-tech prod-ucts for use in Sweden or export all over the world.

Our primary industries are the backbone of Swedish in-dustry and Sweden has leading positions to build on. Taken together, the iron and steel industry, mining and smelting, and further refinement and processing in the engineering in-dustry play a very important role in our industrial system, our economic growth and our net export position. We are increasingly dependent on exports and our interaction with the world around us is becoming even more important.

Companies in these industries are spread throughout Swe-den and regional growth aspects must be heeded. In coun-ty-level work on regional growth programmes, 14 counties

highlight metallurgy as an important area.

The concentration of the industries concerned in strong clusters has valuable advantages. The resulting knowledge and development opportunities, innovative methods and products make it possible to exploit new markets. Coopera-tion in clusters should also help avoid duplication.

The ability of these industries to compete is contingent on research and development in carefully selected strategic areas. To be able to recruit skilled labour, it is important that relevant educational programmes are of a high international standard. Predictable rules that promote growth and long-term sustainable resource use and resource development are also essential factors contributing to increased competitive-ness and growth.

Consequently, some of the vital areas of action emphasised in the strategy programme are projects in research and devel-opment, skills provision and sustainable development.

The strategy programme will be subject to follow-up at periodic meetings of the strategy group.


Vision and strategies“The Swedish metallurgy and mining industries are at the forefront of international

developments in strategically selected areas. Cutting-edge technology, products with high added value and sustainable resource use characterise the whole value chain

from natural resources to customer. This provides for strong international competitiveness and contributes to prosperity and growth in our country.”

This vision will be achieved by strategies focusing on three areas:

Strategy for Research and Development

• World-leading research and development focusing on well-chosen strategic niches and contributing to high added value products, strong industrial companies and strong clusters.

Strategy for Skills Provision

• Education of a high international standard to provide a se-cure supply of skilled labour all along the production chain.

Strategy for Sustainable Development

• Predictable rules that promote growth and strengthen the international competitiveness of the industries. This includes a secure electricity supply and access to electricity at com-petitive prices. Modern society’s need for metals and mineral products must be met by natural resource use and develop-ment that is sustainable over the long term.

STRATEGY FOR RESEARCH AND DEVELOPMENT

• World-leading research and development focusing on well-chosen strategic niches and contributing to high added value products, strong industrial companies and strong clusters.

The industries in the metallurgy sector have differing oper-ating conditions and cooperate with numerous education pro-viders, universities and colleges, and other research performers. Several different clusters exist, with varying degrees of coopera-tion, particularly in steel, mining and rock material areas.

The Swedish companies in these areas operate on an inter-national market. As competition grows tougher, it is there-fore vital to the continued development of trade and indus-

try that Sweden invests in and develops unique cutting-edge skills in research and development. Advanced research in strategic areas creates good conditions for competitiveness in these industries.

The objective is for Sweden to maintain its world-leading status in R&D in selected strategic niches. Cooperation be-tween public sector and industry actors gives Sweden good opportunities to create strong R&D environments that en-able us to keep a leading international position. Research at universities, other higher education institutions and research institutes, conducted in close cooperation with the indus-tries, is essential for long-term capacity-building. Such inter-play is important in the metallurgy area to develop research that is of a high scientific standard and meets the needs of the industry.

Continuity and long-term funding for projects and pro-grammes are crucial in order to build up and maintain a critical mass. It is vital for the industry to seek long-term funding in strategically important areas. The intention is that the industry-oriented programmes carried out should be co-financed by the state and participating companies. This is a means of creating strong R&D environments on the scale needed for the necessary industrial ventures and for contin-ued leadership in a market that is thoroughly international and open to competition.

In order to boost opportunities to commercialise research results and innovations in trade and industry, measures should be taken to make it easier for small and medium-sized enterprises to obtain capital. A system of guarantees should be introduced that gives companies better access to venture capital and short-term credits. This could put inno-vative companies in a better position to enter new markets and introduce new products.

It is also important for Sweden to utilise the results of ba-sic and applied research conducted in other countries and to take part actively in international R&D cooperation in the


EU and elsewhere. Collaboration between Finland and Swe-den on research and development is an interesting option for both countries. World-class research and innovation environ-ments are essential to make Sweden attractive to new and existing knowledge-intensive companies.

STRATEGY FOR SKILLS PROVISION

• Education of a high international standard to provide a se-cure supply of skilled labour all along the production chain.

For the sector to be internationally competitive, skilled personnel must be available at every level in each individual industry. This makes skills provision a key issue, encompass-ing the whole chain from special courses and vocational edu-cation at upper secondary school level to specialist education and research at academic level. In order to ensure that the industry has access to the skills it needs in the future, action is required in both higher and vocational education, as well as measures to improve the image of the industry in society and public attitudes towards it.

Internationally, interest in educational programmes in nat-ural sciences and technology is declining. Sweden has been relatively successful in recruiting young people to technology programmes despite their waning interest in going for a ca-reer in industry. The Government has helped ensure support for the development and building up of regional vocational education centres (“Teknikcollege”) where local authorities, schools and companies collaborate on vocational education at upper secondary and post-secondary level. There are also industrial upper secondary schools, some of them in the in-dustries concerned, which both attract students and provide a very good preparation for working in the industry.

The mission of the higher education sector is to conduct education and research. In addition, higher education has in-structions to interact with society at large. Educational pro-grammes are designed on the basis of demand from students and the needs of the labour market. The required interac-tion with society takes different forms at different higher education institutions, depending on the local and regional actors. Increased cooperation and dialogue between higher education institutions and companies can make educational programmes more attractive. More extensive cooperation between institutions of higher education is also desirable. By supplementing one another’s strengths, they can use re-sources efficiently so as to offer students high quality educa-tion and provide good conditions for outstanding research in areas where Sweden is strong.

Increased international cooperation at the basic level of

higher education is one way to recruit an adequate number of students to programmes that are relevant to the indus-tries. Talks are in progress with Finland in the fields of met-allurgy, mining and minerals engineering, aimed at broad-ening the recruitment base and making better use of the two countries’ combined educational resources. In both Sweden and Finland, too few specialist engineering gradu-ates are needed nationally for university programmes to be carried out in the present systems. Holding parts of courses at Swedish higher education institutions in English, moreo-ver, makes it possible to recruit international students more extensively. Interaction with other mining countries is also important.

The EU Erasmus and Leonardo Programmes, which chan-nel student exchanges in higher and vocational education, are also of potential interest to Swedish industry.

STRATEGY FOR SUSTAINABLE DEVELOPMENT

• Predictable rules that promote growth and strengthen the international competitiveness of the industries. This includes a secure electricity supply and access to electricity at com-petitive prices. Modern society’s need for metals and mineral products must be met by natural resource use and develop-ment that is sustainable over the long term.

The work of the industries concerned involves the explo-ration and extraction of natural resources that in many cases are considered finite. However, in principle metals are infi-nitely recyclable. Metals and minerals are used as raw materi-als and refined for use in a large number of products that are needed by modern society. In view of the increased demand for metals due to growth in China and elsewhere, effective recycling processes and scrap metal collection methods are vitally important in a long-term perspective. One example is the Steel Eco-Cycle project at the Foundation for Strategic Environmental Research.

Systematic environmental work and increased skills at companies, partly in response to legal requirements and financial policy levers, have helped reduce emissions and energy use. The challenge now is to sustain development activities so as to meet the Swedish environmental quality objectives while also reaching targets for growth, greater competitiveness and increased employment. In other words, the three dimensions of the concept of sustainable develop-ment – economic, social and ecological – must be taken into account concurrently. Predictable and long-term rules are crucial for continued development.


Export actionsAction is needed to maintain, develop and support the ability of Swedish companies to succeed internationally and to seize the opportunities that globalisation offers to maintain a high level of exports in the industries concerned. This applies in particular to new product development where the Swedish market is not large enough to bear the development costs.

Competition is steadily increasing in most industries as the number of global actors continues to grow. If Swedish com-panies are to develop a strong position, they must succeed in increasing their market shares. In such cases, intra-industry cooperation in the form of partnership among a group of companies can augment their combined strength and open up new possibilities. There is great potential in companies that supply advanced services and products growing up close to established companies. Another example is environmental technology, the market for which is growing rapidly. Making use of such opportunities for international business in the industries concerned may play an important part in efforts to sustain strong competitiveness.

Many international companies work with the concept of Corporate Social Responsibility (CSR), which essentially means that in some areas these companies take measures on their own initiative that go beyond the requirements of laws and regulations. The point of these measures is to en-hance quality in areas such as the external environment, the work environment or relations with landowners and nearby residents. Such measures can help make the companies more competitive and contribute to sustainable social development in Sweden and internationally. International standardisation is in progress in this area. In March 2002, the Government launched the Swedish Partnership for Global Responsibil-ity, an initiative aimed at encouraging industry to work for global development through increased social and environ-mental responsibility. The initiative is based on the OECD Guidelines for Multinational Enterprises and the principles of the UN Global Compact.

Improved processes make it possible to increase the re-

covery rate for mineral resources. We can use a tonne of steel very much more efficiently now than a hundred years ago. The situation is similar in the mining industry. More advanced exploration and extraction methods can lead to exploitation of resources that were previously unknown or were not considered profitable. More can be done nationally, in the EU and globally. New demands are constantly emerging and pioneering research will be required.

Energy and climateThe steel and mining industry and lime and cement industry are energy-intensive industries. Apart from this, energy use varies from industry to industry. However, one thing the in-dustries all have in common is that the most important form of energy, alongside the forms of energy used as a reducing agent in different processes, is electricity. Good and secure ac-cess to electricity at competitive prices is an important factor in the development of the primary industries. Many compa-nies have made arrangements with local authorities to deliver residual energy to the municipal district heating networks.

The cost of electricity is an important driver of efficiency measures. Companies have long worked purposefully to achieve more efficient energy use. For many of them, the present and future prices of electricity decisively influence their long-term development. Consequently, energy and cli-mate policy measures play a significant role. One example is emissions trading and its indirect impact on the price of electricity. On 6 October 2005, the Government instructed the Energy Markets Inspectorate to analyse the functioning of the electricity market with an emphasis on competition and price formation, and to consider the need for measures to ensure proper competition and effective price formation.

The availability and price of motor fuels have a consider-able impact on all the industries in the sector, as a substantial proportion of the products are transported by road. As other production costs gradually decline, transport costs become more significant. A good infrastructure is an important con-dition for the companies’ profitability and growth.



Strategy programme

The three strategies for research and development, skills provi-sion and sustainable development make up the foundation of the strategy programme. The programme also contains propos-als for a number of measures that will help realise the vision.

In many cases, the proposed measures are highly interde-pendent. This should be borne in mind when implementing them. The actors responsible for moving the process forward are specified after each proposal.

Measures under the strategy for research and development

8 Steel research programmeThe Swedish Agency for Innovation Systems (VINNOVA) should be instructed to make a joint analysis with the indus-try of the conditions needed for an innovative and future-oriented steel research programme and present proposals for the design of such a programme. The plan for steel research in Sweden in 2005-2009 that the Swedish Steel Producers’ Association has drawn up for the joint research needs of the steel industry should serve as a starting point in this work.

Ministry of Industry, Employment and Communications

8 Mining research programmeThe Geological Survey of Sweden should be instructed to analyse the conditions needed for an innovative and future-oriented research programme and present proposals for such a programme. This should be done jointly and in consultation with VINNOVA and the industry. The programme should particularly contribute to development in areas where the Swedish mines and smelters are considered to be at or near the forefront of technology. This may, for example, concern more efficient processing and production methods, develop-ment of new materials and products, advanced environmen-tal technology, reuse and recycling in accordance with the proposal from Bergforsk (the new umbrella organisation for R&D in the Swedish mining and metallurggical sector).


8 Geoscientific researchThe Geological Survey of Sweden – guided by the wishes of the industry and in consultation with other relevant agen-cies – should be instructed to analyse the possibility of sup-plementing its geoscientific research responsibilities with an increased focus on research relevant to ore geology, and to examine the possibility of industry input in setting project priorities.


8 Energy researchUnder the long-term energy policy programme, actions are being taken on research, development and demonstration in a number of different areas. One of these areas concerns en-ergy use and energy efficiency in mining and manufacturing. The focus is on energy-intensive industries. Work is now in progress on drawing up strategies, visions and criteria for pri-oritising energy-intensive industries in the metallurgy area, among others.

Ministry of Sustainable Development

8 Programme for industrial minerals, aggregates and dimensional stone

With a view to making the industrial minerals, aggregates and dimensional stone industries more competitive, the Geological Survey of Sweden should be instructed to draft proposals for a continuation of the earlier MinBaS pro-gramme in this area. In this it should act jointly with the industry and relevant agencies. The programme should par-ticularly contribute to development in potential areas of innovation, function-oriented high-quality products made from industrial minerals and rock, with a special focus on environmental technology and small and medium-sized en-terprises (SMEs). Measures that help create efficient chan-nels for technology dissemination between academia and industry should be included.



8 Programme for the equipment industryWith a view to strengthening cooperation between Swedish SMEs and large Swedish companies in the metallurgical sec-tor, the Swedish Agency for Economic and Regional Growth (Nutek) should be instructed, in cooperation with other rel-evant agencies and industries concerned, to investigate the potential for developing a national, enterprise-driven cluster programme. The programme should contain measures on strategic cooperation between companies, network-building, enterprise-driven and innovative ventures, cooperation across technology borders, systemic solutions and actions to increase the ability of enterprises to compete internationally.


8 Metals processing skills centre in Värmland

The County Governor in Värmland County has a special assignment from the Government to work for economic growth and stronger competitiveness in the Karlstad/Kris-tinehamn region. A proposal on the establishment of a skills centre for metals processing has been drafted with the par-ticipation of more than 100 companies in the region. As envisaged, this centre will focus on applied product in-novations based on the needs of Värmland companies to upgrade from sub-suppliers to companies with products of their own, and will be a nexus between basic research and innovation processes at the companies.

County Governor in Värmland County

8 Supply of capitalTo strengthen the potential for commercialisation of re-search results and innovations in trade and industry, the Government has set aside funds to secure access to skills and capital at early stages of development. The most im-portant feature of this initiative is the formation of Innova-tionsbron AB, a national umbrella group that brings togeth-er in a single organisation several of the public providers of early development capital. To further strengthen early stage financing, Industrifonden Foundation will collaborate with Innovationsbron by providing funds to supplement capital available on the market.

Nutek and some regional actors will also undertake region-al venture capital actions with the support of EU structural funds. These regional venture capital actions are to cooper-ate closely with private regional venture capital companies and investments are to be on market terms. These tools for

capital supply should be capable of helping companies in the industries concerned.

Innovationsbron/Industrifonden/Swedish Agency for Economic and Regional Growth (Nutek)

8 More effective national and international cooperation

To maximise the effect of R&D inputs and cluster cooperation, ongoing joint projects in research and development between all industries in the sector, including suppliers and customers, should be stepped up and rationalised. The industry should consider the possibility of combining activities in network form with a view to avoiding duplication and improving results. The contacts re-quired to create networks between companies and government agencies may also need to be made more effective.

A continued development of EU cooperation should be promoted. Organisations and private companies should par-ticipate actively in different networks under EU framework programmes and should contribute to the preparation of new joint projects and proposals for programmes.

The industry

Measures under the strategy for skills provision

8 Skills provisionThe need for skills provision varies over time and therefore requires continuous monitoring and updating. The state has a central role in providing and taking responsibility for education and regulations, while the industry can play an important part by working on image issues so as to attract skilled people and by offering opportunities for work experience. In order to bring about an effective interplay between the different actors, the in-dustry, in dialogue with higher education institutions and other education providers, should find ways of ensuring that subjects that are relevant and in demand are included in the programmes oriented towards the different sub-industries. There should also be dialogue on the geographical concentration of specialised ed-ucational programmes with a view to overcoming the problems of attaining a critical mass to maintain relevant programmes.

The industry

8 Cooperation with Finland on education and research

Cooperation with Finland is felt to be a valuable means of developing the position of northern Europe as a strong region


for mining and metals. The link between Swedish and Finn-ish mining and metals industries has grown palpably stronger over the past ten years. Maintaining and further developing competitiveness and growth is contingent on research and development of the highest international standard. There is potential for increased collaboration between the two coun-tries in applied research and in the educational area. These issues are being addressed within the framework of the high-level dialogue between Sweden and Finland that was initi-ated by the two countries’ prime ministers earlier this year.

Ministry of Education, Research and Culture, Ministry of Industry, Employment and Communications

8 Promoting increased Swedish participation in international educational programmes

The EU has two programmes for cooperation and exchange in higher education and vocational training: the Erasmus and Leonardo da Vinci programmes. It is not fully known to what extent these programmes are used for enhancing, say, specialist skills that are important to the relevant industries. The Swedish metallurgical industries, together with other actors, should encourage greater Swedish participation in the EU exchange programmes.

The industry

Measures under the strategy for sustainable development

8 Dialogue on energy and climate policyThe Government and the energy-intensive industries should continue their dialogue on emissions trading and other en-ergy and climate policy levers that are significant for the de-velopment of these industries.

Ministry of Sustainable Development, Ministry of Finance, Ministry of Industry, Employment and Communications, energy-intensive industries

8 Programme for energy efficiency in energy-intensive enterprises

Most energy-intensive enterprises are taking part in the newly introduced programme for energy efficiency, which involves introducing energy management systems and other meas-ures. These enterprises and the Government should continue

to cooperate within the framework of the programme.

Ministry of Sustainable Development, energy-intensive industries

8 Voluntary commitments/CSRThe industry should publish examples of its work on voluntary measures to develop and improve attitudes and impacts relat-ing to the external environment, the work environment or, for example, relations with landowners and nearby residents.

The industry

8 Drafting of a guide on exploration in Natura 2000 sites

Special regulations apply to Natura 2000 sites and are incor-porated in the Swedish Environmental Code and the Site Pro-tection Ordinance. The Government Offices should investigate the possibility of asking the Geological Survey of Sweden and the Swedish Environmental Protection Agency, after consult-ing the industry, to draw up a guide on appropriate exploration methods in protected areas, particularly Natura 2000 sites.

Ministry of Sustainable Development, Ministry of Industry, Employment and Communications

8 Aerial survey campaign in Norrbotten, Västerbotten and Bergslagen

Sustainable development is partly contingent on good in-formation about existing mineral resources in Sweden. One important source for mineral exploration is aerial geophysi-cal data. Exploration companies have called attention to de-ficiencies in this area.

The Geological Survey of Sweden should be commis-sioned to assess the precise requirements for and effects of a new aerial survey campaign in certain areas that are of inter-est for exploration and to assess what is required in order to integrate this work into the Survey’s long-term objectives.


8 Effective access to data of interest for exploration

The Geological Survey of Sweden should be commissioned to consult with relevant industries and analyse and clarify the conditions for and needs, costs and effects of improved access to data of interest for exploration.




Business environment

Strong global demand for steel in recent years has led to rapid production growth. Over the past ten years, produc-tion has increased on average by 3.8 per cent per year. In 2004, world production of crude steel reached and passed the magic boundary of 1 billion tonnes.

The increased demand is mainly explained by China’s rapid economic growth. Demand has risen substantially in other parts of Asia as well. China’s production of steel has also grown sharply in just a short time. In 2004 China accounted for 25.8 per cent of the world’s crude steel production. This represents almost a tripling of output since 1995. In 2004 the output of crude steel in China increased so vigorously that the growth alone exceeded Germany’s total annual production of crude steel. Germany is the largest producer in Europe.

The international steel industry is now undergoing a process of restructuring similar to that which the Swedish steel industry has already been through. A number of major steel groups are emerging, with production in many different parts of the world. Two examples are Mittal Steel, with operations worldwide, and the European company Arcelor, with plants in five EU countries and Brazil.

The rising demand for steel has created a new situation for all actors in the market, with higher volumes and prices for raw materials such as coal, iron ore, scrap and alloying mate-rials. Freight costs have also shot up. This is a disadvantage for the Swedish steel industry, which has to move its products longer distances to reach customers than its competitors.

Strong demand for metals

The consumption of metals has increased by about ten per cent per year in recent years. As a result, iron ore prices and various other metal prices have reached record levels in 2005. China consumes 15-17 per cent of all metals in the world. The developed countries have not reduced their consumption of metals at the rate previously predicted. If growth in other parts of Asia apart from China continues positive, the demand for metals can be expected to remain at a high level.

High price levels lead to increased exploration for new de-posits while also reinforcing the motivation to recycle. An estimated 35 billion tonnes of ore and rock are handled each year in all industries, including metals, industrial minerals, coal, gravel and stone. Approximately 10 per cent of this is from underground mines. Gold, copper and iron ore are the leading metals in terms of value. It is important for the glo-bal mining industry that sufficient resources can be allocated to exploration for new deposits and developing new metal-lurgical methods and important, not least, that the industry succeeds in managing long-term environmental problems. The main competitors of the Swedish mining industry are in Australia, South Africa, South America and Canada.

Advanced industrial minerals are found and produced by companies in many countries, with developed countries clearly dominant. In recent years there has been restructur-ing in the industry, with increased specialisation and concen-tration of ownership in certain product areas. This process has been driven by the need to improve profits. Suppliers of mineral products face increasing demands to deliver techni-cal services to the customer in order to establish long-term cooperation. The market for highly processed products such as fillers and pigments is expanding.

Aggregates are produced and used in every country in the world. Production is local, due to the great availability of raw materials. At a rough estimate, world production is 14 billion tonnes per year. In Europe, the use of crushed rock as aggre-gate is becoming increasingly widespread. It is suitable rock in coastal areas that is often exported. There is a clear trend towards larger producing companies, since quarries require major investments. In many countries gravel is in short sup-ply and alternative materials are therefore increasingly used, mainly crushed rock but also recycled building materials.

Dimensional stone can be produced and transported for use all over the world because types of stone that are in de-mand command relatively high prices and cost relatively lit-tle to freight. Global production has increased very sharply over the past 20 years and is now estimated at approximately 40 million tonnes per year, the largest producers being Italy, China, Spain and India.



Prospects for Sweden

Sweden has a very long tradition of mining. In many cases, high-grade Swedish ores have made it possible to develop high-quality products and this potential is carried forward by the present development of niche products meeting high standards.

The Fennoscandian Shield is a geological formation that stretches across Finland, Sweden and Norway and is con-sidered by prospectors to offer good conditions for mineral deposits. Sweden has other advantages as well: good roads, an English-speaking population, good minerals legislation and strict environmental legislation. The existence of mines in the country and the opening of new mines clearly indi-cate that the geology, the infrastructure and the regulatory framework perform well. Four of the world’s largest mining companies are represented among the international compa-nies exploring in Sweden. Sweden clearly stands out in in-ternational competition as an interesting country for explor-ers In a global perspective, Sweden is a small mining country but many global exploration companies consider its bedrock underexplored and interesting. As a result, SEK 250 million was spent in exploration in Sweden in 2004. In mid-2005, there were twice as many applications for new exploration permits as in mid-2004.

Through strategic product and technology development, LKAB has managed to maintain its competitiveness in the international market. The iron ore found in LKAB’s mines is magnetite ore, which is a competitive advantage in that less energy is required than for other types of iron ore for upgrading to pellets or sinter. Steel produced from LKAB pellets gives the world’s lowest carbon dioxide emissions. LKAB’s experimental blast furnace offers unique opportuni-ties to develop pellets either for optimal blast furnace or di-rect reduction operations, or as specialised products to meet the needs of different customers. Swedish mines and smelt-ers meet high standards for technical development and low emissions to the environment.

A highly demanding global marketIf international demand for steel has increased, this applies even more to highly processed and advanced steel products. Since in all essential respects the Swedish iron and steel industry operates in a global market in tough international

competition, both products and market organisation must meet demanding requirements. Open and free trade is con-sequently of the utmost importance. Swedish companies have branches all over the world and work in close contact with their customers, which have significant impact on prod-uct development and research.

In both the mining and the steel industries, larger and larger volumes are being produced by fewer and fewer employees. This has been achieved by automation and the development of a high level of technology in IT and other areas.

Sweden has the potential to develop its production of industrial minerals for export to other EU countries. This applies primarily to types of minerals that are not available elsewhere in the EU or for which supplies are beginning to run low. Examples include high-quality aggregates, dimen-sional stone, feldspars and dolomites of good quality, as well as graphite, wollastonite and kaolin. Swedish producers have done well in terms of technical development and market requirements. This may be one of the reasons why interna-tional producers have shown increased interest in including Swedish entities in their groups.

Developing the aggretates industry for a growing export market requires the establishment of quarries in coastal areas with access to ports.

The dimensional stone industry extracts a number of unique types of stone that are appreciated internationally and have a high market value. It is considered that the way for Swedish companies to hold their own in a competitive market is to continue to produce the grades of highly col-

Steel exports SEK/ton

1 Sweden 8 400

2 Finland 7 951

3 Slovenia 7 002

4 Switzerland 6 026

5 USA 5 762

6 Italy 5 472

11 Germany 5 064

20 Japan 4 048

Table 1 Average of all products: non alloy, stainless and other alloy

Source: Iron and Steel Statistics Bureau


oured and attractively patterned stone that are in demand and that command a high price.

Interaction with regional growth programmesIn county-level work on regional growth programmes, 14 counties highlight metallurgy as an important area. The main emphasis in the proposals is on further processing of metals that have substantial potential for development. This further processing involves several industries and product areas. In many counties projects are underway involving skills and product development for further processing and more or less well-developed enterprise clusters as carriers of develop-ment. The potential for interaction between regional growth programme projects and the strategy programme for metal-lurgy should be investigated.

Research and developmentSweden has internationally outstanding materials research, based mainly in the mining and metals industries. By work-ing with materials researchers, the Swedish steel industry, for example, has developed important export products. In the latest research policy bill, Research for a better life (Gov. Bill 2004/05:80), the Government also announced an investment in technical research, including the materials area, which, when completed in 2008, will entail an increase of SEK 350 million per year in the resources available for technical re-search via VINNOVA and the Swedish Research Council.

For many years, enterprises have made strategic commit-ments to support long-term research projects and build up research groups in important areas at higher education in-stitutions and research institutes. In Sweden steel research is carried out by the steel companies, the research institutes Metallurgical Research Institute AB (MEFOS) and Corrosion and Metals Research Institute (KIMAB), and by the Royal Institute of Technology (KTH), Luleå University of Technol-

ogy (LTU) and Högskolan Dalarna. In addition, there is a long-established Nordic network for steel research directed and coordinated by the Swedish Steel Producers’ Associa-tion. Swedish steel researchers are active in European steel research, primarily the research financed by the Research Fund for Coal and Steel, and have been very successful in competing for projects.

Metallurgy research is mainly conducted at KTH and LTU. LTU is the European leader in mining and metallurgy re-search and has unique breadth. The research area encompass-es the entire production chain from exploration, extraction and beneficiation to metallurgy, waste and environmental technology. The university’s close cooperation with the in-dustry has led to a number of research centres being built up, for example, MiMeR (the Minerals and Metals Recycling Research Centre), the Agricola Research Centre, Swebrec (the Swedish Blasting Research Centre), ProcessIT, and the Hjalmar Lundbohm Research Centre. The R&D programme Bergforsk has been jointly planned by the mining industry, represented by the research foundation MITU, academia, represented by LTU, and the public sector, represented by the non-profit association Georange.

Research in the aggregates area is conducted in cooperation with the industry at Chalmers University of Technology and the Swedish Rock Engineering Research Foundation (produc-tion engineering) and at KTH (geology, land and water resourc-es engineering, and after-treatment). In industrial minerals, the Swedish Mineral Processing Research Association (MinFo) works with collective R&D programmes for the mineral indus-try and suppliers. This takes place at LTU and in cooperation with industrial research institutes e.g. the Swedish Cement and Concrete Research Institute and other partners. The dimen-sional stone industry engages in research projects concerning the use of dimensional stone in construction and lifecycle analy-ses at the Lund Technical University, the Swedish University of Agricultural Sciences and Kalmar University..

Laisvall

BlaikenSvärtträsk

SvartlidenFäboliden

Vargbäcken

Kristineberg

StorlidenMaurlidenNorrliden

ÅkerbergBjörkdal

PetiknäsRenström

GarpenbergGarpenberg Norra

Billinge

Kirunavaara

MalmbergetAitik

Iron ore

Sulphide ore

Gold ore

Industrial minerals

In production

Recently closed

Licence applied for or approved

Zinkgruvan

Mines in Sweden

2005

BERGSSTATEN0 50 100 150 200 250 km

VramLunnom

Barsele

Lovisagruvan

Source: Mining Inspectorate of Sweden


The industries in brief

Facts about the iron and steel industrySteel is one of Sweden’s most important export goods. In 2004, 4.7 million tonnes of steel were exported, valued at SEK 47.5 billion. This corresponds to approximately 90 per cent of the total value of production.

Sweden is unique in the world in having alloy steel make up so high a proportion of its total output, 53%, compared with 15% in the rest of EU15 and 10% in Japan and the United States.

As a result of a pronounced focus on niche products, the Swedish iron and steel industry is the world leader in care-fully selected product segments, where it has won very large shares of the world market. The following are examples of product groups where the Swedish iron and steel industry holds a world-leading position: • Stainless seamless pipes from Sandvik Materials Technology• Wire and strip steel for heat generation from Kanthal• Stainless sheet metal from Outokumpu Stainless• Tool steel from Uddeholm• High-speed steel from Erasteel Kloster• High-tensile steel from SSAB• Iron powder from Höganäs• Ball bearing steel from OVAKO

The Swedish iron and steel industry would have been unable to implement its niche strategy without extensive commitments to research on the part of the companies, im-plemented both directly and indirectly through the steel re-search institutes MEFOS and KIMAB. The Swedish iron and steel industry invests no less than 2% of its turnover in R&D. For comparison, the equivalent figure for EU15 is 1%, for the United States 0.5% and for Japan 1.8%.

Other characteristic features of the industry are its branch-es around the world and close contact with the product’s end users. Several of the companies are wholly or partly for-eign-owned. Production is essentially concentrated in mid-Sweden, smaller sites in Bergslagen and Luleå.Number of employees: Approximately 20 000.

Facts about the mining industry and the Rönnskär smelterThere are sixteen mines in Sweden, mainly operating un-derground. The mines are owned by six groups: LKAB, Boli-den, Minmet, Lovisagruvan, Svartliden Guld and the Lundin Group.

The Boliden smelter at Rönnskär outside Skellefteå proc-esses concentrates of copper, lead and gold. These are used to produce copper, lead, gold and silver by smelting and elec-trolysis. The Rönnskär smelter is also one of Sweden’s largest recyclers of electronic waste in its production of copper, gold and platinum metals.

The mining industry invests some SEK 250 million per year in basic research and development.Total value of production: Approximately SEK 19 billion.Export revenues: Approximately SEK 10.5 billion. Number of employees: Approximately 5 100.

Iron 89,20% 1st

Gold 26,90% 2nd after Finland

Zink 23,80% 2nd after Ireland

Silver 16,90% 2nd after Poland

Led 30,40% 3rd after Ireland, Poland

Copper 11,40% 3rd after Poland, Portugal

Table 2 Sweden’s share of mine production in EU-25



Facts about the equipment industryThe equipment industry has grown up in close cooperation with demanding customers, the mining and steel industries.

With global operations, Atlas Copco and Sandvik are among the largest companies in the world for rock drilling and transport equipment, and, in the case of Sandvik, rock crushers. ABB is one of the largest companies for mine hoist-ing machinery, ventilation systems and electricity supply. Sund-Birsta is the world’s largest supplier of handling equip-ment for wire mills and Åkers International is the world’s largest manufacturer of cast rolls. In blasting engineering there are companies such as Dyno Nobel and Kimit. Volvo makes loaders and excavators, tractors, trucks and haulers. ITT Flygt has a prominent position in manufacturing pumps for the mining industry. Medium-sized companies worth mentioning include GIA Industries, which makes locomo-tives and trucks, and Hagby, which makes diamond drilling equipment for core drilling and for the dimensional stone industry. In addition to these, there are a number of smaller engineering companies that develop and market measuring instruments and control equipment, as well as equipment for processing dimensional stone.

Rationalisations in recent years have led to Swedish-Finn-ish co-ownership in the equipment industry. Much of Sand-vik’s drilling and mine transport machinery is manufactured in Finland. Finnish companies like Metso and Outokumpu manufacture ore handling devices, crushers and mineral processing equipment in Sweden.Export revenues: Estimated at over SEK 16 billion. Number of employees: Approximately 10 000.

Facts about the aggregates industryAggregates in the form of crushed rock, gravel and recycled inert material provide the base for infrastructure construc-tion. These materials are also used as an input raw material in asphalt and concrete. Production: Over 77 million tonnes – Sweden’s largest in-dustrial product in terms of volume. There are about 3 000 licensed quarries. Most production takes place in the metro-politan regions of Västra Götaland, Stockholm County and Skåne.Number of employees: Approximately 6 000.Total value of production: Approximately SEK 6 billion. Exports and imports: 1–2 million tonnes are exported, im-ports are negligible. Producers: Some of the largest actors are NCC Roads AB, Swerock AB, Sand & Grus AB Jehander, Skanska Sverige AB and Vägverket Produk-tion. The larger investments required for rock quarrying as opposed to gravel quarries have influenced the tendency towards more concentrated ownership. Nonetheless, a large number of quarries around the country are run by small and medium-sized com-panies.

Gravel quarries



Facts about the industrial minerals industryIndustrial minerals, such as limestone, quartzite, feldspar and clays, are important input goods for manufacturing products including cement, glass, paper, plastic, steel and other metals, and also in the environmental engineering area.Production: Over 10 million tonnes. Number of employees: Approximately 2 000.Total value of production: SEK 2 billion.Exports and imports: Half the output is exported. Sweden imports 4.5 million tonnes, valued at SEK 2.5 billion. The imports consist of minerals that are not extracted in this country.Producers: Some of the major producers of limestone-based products are Cementa AB, Nordkalk AB, Björka Mineral AB and SMA Svenska Mineral AB. Askania AB, Baskarpssand Brogårdssand, Lafarge Svenska Höganäs and North Cape Minerals produce quartz/quartz sand/feldspar. The com-panies are often small or medium-sized. Many belong to larger groups. SSAB Merox AB makes special products in

the industrial minerals sec-tor from residual products from SSAB’s iron and steel production. LKAB-owned Minelco AB has substantial international industrial min-erals operations and makes special products based on iron oxides from LKAB. A number of smaller companies work on developing unique industrial mineral deposits for new pro-duction.

Facts about the dimensional stone industryDimensional stone has been used for building from time im-memorial. The durability of stone and its minimal mainte-nance requirements bear testimony to its unique qualities in ecocycle terms. This is leading to increased use. Production: 1 million tonnes of quarried material. There are 62 productive quarries. Number of employees: Approximately 1 100.Total value of production: Dimensional stone products have a sales value of approximately SEK 1 billion.Exports and imports: 25 per cent is destined for export. The value of imports comes to SEK 250 million. China is a major trading partner, both for exports and imports.Producers: There are just over 200 companies in the industry. Only 25 of them have more than 10 employees. The four largest corporate groups are Emmaboda Granit AB, AP-Sten AB, Bohus-läns Kooperativa Stenindustri and Skifferbolaget AB.

Stone quarries

Industrial minerals quarries



Strategy group and secretariat

The following people have participated in the strategy group

Sven-Eric Söder Ministry of Industry, Employment and Communications (chair)

Elisabeth Nilsson Swedish Steel Producers’ Association

Tomas From Swedish Association of Mines, Mineral and Metal Producers (SveMin)

Per Murén NCC Roads AB

Ola Asplund Swedish Metalworkers’ Union

Nils-Åke Carlsson Sif – Sweden’s Leading White Collar Union

Mats Öhrn Swedish Association of Graduate Engineers and Sandvik

Lars Ljung Geological Survey of Sweden

Per Eriksson Swedish Agency for Innovation Systems (VINNOVA)

Ulf Holmgren Swedish Agency for Innovation Systems (VINNOVA)

Björn Näsvall Swedish Agency for Economic and Regional Growth (Nutek)

Anders Wenström Swedish Trade Council

Stina Gerdes Ministry of Education, Research and Culture, Division for Research Policy

Maria Gårding Wärnberg Ministry of Sustainable Development, Division for Energy

Bo Diczfalusy Ministry of Sustainable Development, Division for Energy

Olle Björk Ministry of Sustainable Development, Division for Energy

Nicklas Liss-Larsson Ministry of Industry, Employment and Communications, Division for IT,

Research and Development

Olof Sandberg Ministry of Industry, Employment and Communications, Division for IT,


Maria Dahl Torgerson Ministry of Industry, Employment and Communications,

Coordination Secretariat

Bengt Toresson Ministry of Industry, Employment and Communications,

Division for Sustainable Development and Primary Industries

Ann-Christin Cederlund Ministry of Industry, Employment and Communications,


Monika Mörtberg Backlund Ministry of Industry, Employment and Communications,



The following people have participated in the secretariat

Ann-Christin Cederlund Ministry of Industry, Employment and Communications, Division for

Sustainable Development and Primary Industries (chair)

Mathias Ternell Swedish Steel Producers’ Association

Tomas From Swedish Association of Mines, Mineral and Metal Producers (SveMin)

Göran Bäckblom MITU research foundation/Bergforsk

Marianne Thomaeus Swedish Mineral Processing Research Association (MinFo)

Riitta Lindström Swedish Aggregates Producers Association (SBMI)

Josefine Larsson Swedish Metalworkers’ Union

Emma Åberg Sif

Lars Garnefält Swedish Association of Graduate Engineers

Anders Marén Swedish Agency for Innovation Systems (VINNOVA)

Björn Näsvall Swedish Agency for Economic and Regional Growth (Nutek)

Sven Arvidsson Geological Survey of Sweden

Peter Hellsten Geological Survey of Sweden

Göran Hamne Swedish Trade Council

Sara Kilander Ministry of Finance, Budget Division

Stina Gerdes Ministry of Education, Research and Culture, Division for Research Policy

Mats Johnsson Ministry of Education, Research and Culture, Division for Research Policy

Maria Gårding Wärnberg Ministry of Sustainable Development, Division for Energy

Nicklas Liss-Larsson Ministry of Industry, Employment and Communications, Division for IT,


Monika Mörtberg Backlund Ministry of Industry, Employment and Communications, Division for

Sustainable Development and Primary Industries


www.sweden.gov.se

Documents

ND 183 Metallurgi ENG - Bergforskbergforsk.se/wp-content/uploads/2011/08/metallurgy_in_sweden.pdf10 An integral part of Innovative Sweden EU and elsewhere. Collaboration between Finland