BlueScope to spend $1.15b on old-school steelmaking

afr.com:

Australia’s largest steelmaker, BlueScope, will spend $1.15 billion relining a blast furnace at its Port Kembla steelworks in what chief executive Mark Vassella describes as a “bridge to the future”, with old-school steelmaking processes needed for at least 10 years.

He said large-scale commercial production of low-carbon steel across the industry was still at least a decade away, with more breakthroughs needed in technology and enablers such as renewable energy firming capacity before they could be broadly introduced.

“My personal view is it’s probably 10 years away,” he said on Monday.

BlueScope chief executive Mark Vassella. Wayne Taylor

But he did say momentum in the steel industry to cut carbon emissions was moving faster than he had predicted just two years ago.

“The technology is moving faster than we might have expected,” he said. Steelmaking creates about 8 per cent of the world’s carbon emissions.

BlueScope kept its final dividend steady at 25¢ per share as net profit after tax slumped 64 per cent to $1.01 billion, with steel prices and margins falling compared with a year ago when the group delivered its highest underlying profit on record. BlueScope shares gained 3.3 per cent in early trading on Monday to $21.24.

Earnings before interest and tax in the Australian operations were down 59 per cent to $537 million even though its Colorbond steel roofing products delivered record sales for the year to June 30.

Mr Vassella said steel was taking market share from traditional timber roof trusses, and Colorbond steel roofing was gaining in popularity. “We’re taking share in roofing,” he said.

The group’s North American operations suffered a 57 per cent slide in EBIT to $965 million in 2022-23 as steel prices