The steel industry in the North African country wants to deliver more than steel for construction in future. Therefore, investments are being made into higher quality alloys and above all into producing climate-friendly steel.
Morocco’s steelworks could be of interest to German mechanical and systems engineering as well as German energy and electrical engineering companies in several respects, writes Ullrich Umann from Germany Trade & Invest (GTAI), the Federal promotional body for foreign investments. For example, in 2024 the steel industry so far invested a great deal more than in the previous year. One reason for this is that the construction sector, the main customer in the current year, is ordering more steel products again.
On the one hand, steel makers are investing in their capital stock, for which they need high-quality technological goods, also sourced from Germany. On the other hand, the sector is increasing the proportion of green energy used in the smelting and processing steps, and to this end is importing the best available technology for the production, storage and transfer of electricity from renewable sources. Investments are also being made into the production of industrial gases.
In addition, the Moroccan steel companies are extending the scope of their foreign supply sources for scrap iron and steel, which they mainly use as raw material for manufacturing new steel products. On average, the yearly imports of scrap steel and iron reached 0.45 million tonnes. Domestic sources supplied 0.65 million tonnes per annum, which means that in total, 1.1 million tonnes were melted down and reused. This volume is now set to increase through additional scrap imports.
Plans for increased scrap iron imports
The fast-growing steel maker Riva Industries is particularly looking for additional sources of scrap iron, explicitly including sources in Germany. With the additional supply, the company hopes to achieve better utilisation of foundry and consequently also of rolling mill capacities. According to calculations by the industry association ASM, the industry on average utilised 42.5 percent of its capacity for strand casting in the year 2022. In order to operate at a profit, there must be a utilisation rate of at least 61 percent according to the OECD.
The most common steel production method found in the steelworks is strand casting. Among the techniques in use is continuous casting of billets and pre-block strand casting to produce round or square cross-sections (so-called billets) and profiled cross-sections from which rods, wires and profiles for the construction industry are made. Another method is slab strand casting, which produces square strands with a large width (up to more than 2,600 millimetres) and a small thickness (up to 600 millimetres) for further manufacture of metal sheets and flat profiles.
In order to increase their share of the market, some steel makers are placing their hopes on the production of green steel. The Sonasid company which has production sites in Jorf Lasfar, Nador and Berrechid already uses 88 percent renewable electricity. Currently, work is being done to further increase this ratio, and to this end a photo-voltaic system worth 1.5 million euros is being built at the Nador site. Sonasid is further investing in a steel wire rod-pulling system at Nador, for which the world’s largest steel corporation, ArcelorMittal, which has shares in Sonasid, is providing technical support.
Steel makers are diversifying their fields of business
The company Riva Industries, too, wants to increase the proportion of green electricity used in the smelting and production process to 100 percent. To this end, Riva is preparing to found its own subsidiary to produce green electricity in order to outsource this business unit and thus make it more efficient. Other than modernising and decarbonising, the steel makers are diversifying their range of products and services. For example, Riva Industries are expanding their production facilities for oxygen, nitrogen and argon at the Jorf Lasfar site. The company is also expanding the infrastructure at the ocean port of Jorf Lasfar in order to more quickly import scrap iron and ship finished steel products.
Another part of Riva's diversification is switching their company cars and lorries to electric drives; suitable solutions for this are currently being sought. Further investment plans include a plant for separating used rotor blades from wind turbines into their material components. In this way, Riva wants to become the leading supplier for this recycling service for the entire Mediterranean and parts of Europe.
Source: GTAI
