Transportation and infrastructure
To make it possible for steel companies in Sweden to compete on the world market, the availability of a properly functioning infrastructure combined with an efficient and competitive transport sector are necessary.
SSAB uses new-generation ships, fueled by liquefied natural gas (LNG), for transportation of raw materials between Luleå, Brahestad and Oxelösund. Compared to low sulfur oil, LNG reduces carbon dioxide emissions by 57 %. Emission of sulfur dioxide decreases by 92 % and PM particles by 98 %. Photo: ESL Shipping / Studio Lindblad.
The steel industry – an important buyer of freight transport
The steel companies in Sweden export the major part of their production e.g. plate, strip, wire, bar, rod, profiles and tubes. At the same time, most of the steel used in Sweden is imported. For the production of steel, the import of input goods – alloys, scrap metal, coal and limestone for example – is also required. The far-reaching export of steel products to some 150 countries around the world and the need for input goods make the steel industry one of Sweden’s largest users of transport services by road, rail and sea.
About one half of Sweden’s steel exports is carried by train and only slightly less by ship. The remainder is transported by truck. A significant portion of the input goods imported to Sweden is also carried by sea or rail. In addition to this are all the transport operations that occur between the various production sites within Sweden. These operations take place mainly by road or rail.
Since the steel industry in Sweden is part of a global business, it is also important that people who work in the industry can rapidly move between production sites, cities and the rest of the world.
Steel industry’s seaborne transport
Maritime transport is essential for the steel industry and comprises the basis for its exports. Sweden has a competitive disadvantage compared with other countries since the distance to its vital export markets is comparatively large. An efficient and competitive shipping sector is consequently a precondition for export success.
Europe remains the largest market for steel exports, with more than 70 percent of exports going to the EU member states and Norway. However, the markets that have grown fastest in recent time are found further away, in the USA and Asia.
A large part of the steel industry’s export (3.8 million tonnes in 2017) to these markets goes by sea. These seaborne transports operate mainly between Sweden and the continent with onward transport to more distant destinations.
The import of input goods to the steel industry also takes place partly by sea.
The transportation of iron ore for the ore-based component of steel production operates between the ports of Luleå and Oxelösund in Sweden.
Major issues for shipping in Sweden:
- Financing of icebreaking, both operation and investments
- Swedish Maritime Administration’s fees (navigation channels, pilotage charges etc.)
Wide-ranging rail transport
About a half of the steel industry’s exports consist of rail freight to continental Europe. An even larger proportion of exports uses rail for part of the operation, for example to or from a port.
The railway is also used to a large extent for transport operations within Sweden. The so-called steel shuttle on the Northern Main Line (Norra stambanan) operates daily freight services between SSAB’s plants in Luleå and Borlänge.
The steel shuttle on its way with steel slabs from Luleå to Borlänge for further processing. Photo: SSAB, Pär K Olsson.
The railway as a means of transport produces low emissions of carbon dioxide; this is a factor to which companies pay attention in the selection of transport method. At the same time there are technical and administrative shortcomings both in the Swedish and European railway systems which make railway transportation less attractive. The major maintenance problems affecting railway operations in Sweden has led to a reduction in freight carried by rail. This is starkly at odds with the stated policy ambitions to increase the role of railway transportation.
Major issues for the railways in Sweden:
- Operation and maintenance of the infrastructure
- Railway access charges
Road haulage is also needed
Heavy truck transport is one alternative where other types of transport are often lacking. For transport operations from the harbours and rail freight terminals out to the steel plants, or the customers, then heavy trucks may be the only alternative. The same applies in the case of transportation between different plants. Road haulage is used to a greater extent for transportation of steel within Sweden than for export; frequently, however, it is one vital link in the chain with shipments to foreign countries also.
The fact remains that the steel industry, through the products it manufactures, can contribute to making road transportation more efficient than at present. For example, there is great potential for cutting emissions from road haulage through increased use of high strength steels in vehicles, both in Europe and globally. Road vehicles become safer, lighter in weight and more fuel efficient.
Read more: Environmental benefits of high strength steel in timber trailers
High strength steel in timber trailers has both environmental and economic advantages. Photo: SSAB.
Major issues for road transportation in Sweden:
- More efficient heavy-duty trucks (74 tonne trucks),
Lean more: 74ton.nu - Kilometre tax, also called the road wear tax
Read also: stoppakilometerskatten.se (Stop the kilometre tax)
Working together for the benefit of steel transport
When it comes to transport issues, work is done in close collaboration with the Confederation of Swedish Enterprise and other relevant industry organizations.
Jernkontoret is a member of the Swedish Shippers’ Council (NTR), an organisation that focuses on the needs of the transport users where transport policies are concerned.
The European steel organisation, Eurofer, has a Working Group which handles certain transport policy issues within the EU.
