Alloy steel: Steel with modified properties that is made by combining iron with one or more elements in addition to carbon. Alloys change the properties of the steel making it, for example, harder, more formable, etc., depending on the combination and amounts of alloys used.
Annealing: The process by which steel is heated and then cooled to improve its formability and make its surface more durable.
Arbitrage: Selling a commodities contract in one market and buying a contract for the same commodity in another market. For example, selling an LME contract and then buying a Comex contract, or visa versa.
Backwardation: Market condition where the spot, or current price for a metal is higher than the three-month delivery price. This usually indicates immediate demand is perceived to be stronger than long-term demand. Not considered to be a "normal" market state (See Contango).
Bar: A shape of steel that is available in different forms such as rounds, squares, hexagons and rectangles.
Billet: A square form of semifinished steel that later is rolled into a finished product such as a bar.
Blast furnace: The mother of the steel industry furnaces, it creates combustion by forcing a current of air under pressure and obtains iron by the reduction of iron ore with suitable fuel and fluxes at high temperatures.
Bloom: Larger than billets, blooms are square or rectangular semifinished shapes that are rolled into finished products such as beams.
Breakout: An accident caused by the failure of the walls of the hearth of the blast furnace resulting in liquid iron or slag (or both) flowing uncontrolled out of the furnace.
Busheling: A widely traded form of steel scrap consisting of sheet clips and stampings from metal production. Bushel baskets were used to collect the material through World War II, giving rise to the term.
Call: an option, but not an obligation to buy (See Options and Put).
Carbon steel: Steel that has properties made up mostly of the element carbon and which relies on the carbon content for structure. Most of the steel produced in the world is carbon steel.
CDA: Copper Development Association
Charge, Charging: Terms used for putting raw materials into a furnace. For example, a blast furnace is charged with coke, coal, iron or scrap to make raw steel. The charge itself is the amount of material loaded into the furnace.
Chromium: A steel-gray, lustrous, hard and brittle metallic element that takes its name from the Greek word for color--chrome--because of the brilliant colors of its compounds. It is found primarily in chromite. Resistant to tarnish and corrosion, it is a primary component of stainless steel and is used to harden steel alloys.
Clearing house: Part of a commodities exchange that monitors buying and selling of contracts, matches the buys and the sales.
Cold-rolling (CR): Rolling steel without first reheating it. This process reduces thickness of the steel, produces a smoother surface and makes it easier to machine.
Contango: Market condition where the spot price is less than the three-month delivery price. This is considered the "normal" market state because the costs of storing and shipping metal are assumed to be higher in three months than at present (See Backwardation).
Copper cake: A by-product of electolytic zinc refining, usually containing a fair amount of cobalt.
Copper, No. 1 and No. 2: Generally, No. 1 copper consists of copper clippings, punchings and so on that are clean and unalloyed, whereas the lesser-priced No. 2 should have a minimum 94-percent copper content. These items are known as "candy" and "cliff" when traded internationally by wire. Comp solids refers to composition or red brass scrap, solids being one thing and borings/turnings another (the latter typically comes from machine shop production). It should be noted that ingot makers often have their own specs for these scrap items, so what one could be buying as a No. 1 could be downgraded to a No. 2 by another consumer. The trading community uses these specs based on the Institute of Scrap Recycling Industries, Washington, which publishes its definitions and is available from any member of ISRI.
Direct-reduced iron (DRI):A metallic iron product made from iron ore pellets, lumps or fines that is reduced (by removing only the oxygen) from the ore at a temperature below the melting point of the iron. DRI is used as feedstock in electric-arc furnaces, blast furnaces and in other iron and steelmaking processes.
Electric-arc furnace (EAF or EF): An economical method of steelmaking that is energized by an electric arc flowing between two bottom electrodes. Furnace charges consist of purchased scrap.
Electrical steel: Steel that includes silicon. The silicon content allows the steel to minimize energy loss during electrical applications.
f.o.b.: Prices denote the so-called free-on-board payment, for material that a consumer or agent will give when he picks it up at a dealer's dock. The f.o.b. prices are usually less than delivered-to-works prices for the same items.
Fabricator: A producer of intermediate products that does not also produce primary metal. Examples include brass, wire and rod mills, which buy copper and other primary or secondary metals to produce brass and other copper alloys, or take raw forms of metal and make building, magnet, telecommunications and/or industrial wire, rod, and similar products.
Ferroalloy: A metal product commonly used as a raw material feed in steelmaking, usually containing iron and other metals to aid various stages of the steelmaking process such as deoxidation, desulfurization and adding strength. Examples: ferrochrome, ferromanganese and ferrosilicon.
Flat-rolled steel: Steel processed on rolls with flat faces as opposed to grooved or cut faces. Flat-rolled products include sheet, strip and tin plate, among others.
Futures contract: Legally binding agreement to buy or sell a commodity.
Galvanizing: The process by which steel is coated with a layer of zinc. The zinc coating provides the steel with greater corrosion resistance.
Hedging: Taking an opposite position in the commodity futures market to your position in the physical market.
Hex / Hexagonal: Metal having six sides and six angles; six-sided.
Hot-rolling, hot-rolled steel (HR): Rolling steel slabs into flat-rolled steel after it has been reheated.
Ingot: Steel cast in a metal mold ready for rolling or forging. It is distinct from a casting, which is not rolled or forged. Ingots are usually rectangular, called slabs; square, called blooms; polygonal, eight- or 12-sided for forging. Squares and polygonal ingots can be fluted or corrugated to increase the surface area and reduce the tendency to crack while cooling.
Junk batteries: This term usually refers to spent automotive lead-acid batteries, which are purchased by secondary lead smelters. The standard form of shipment is in the whole and undrained state to meet environmental regulations. Lead metal constitutes around half the weight of a junk battery. Other parts, including the plastic case, also are recycled.
Lanthanides: Commonly referred to as 'Rare Earth' metals. Examples: Neodymium, Lanthanum and Ytrrium.
Leaching: A process in which metal is extracted from mined ore by means of adding a soluble substance. Commonly used in gold mining.
Liquidation: In commodities market parlance, selling long positions to counterbalance previous buying.
Long: In commodities market parlance, buying more futures contracts than you sell.
Options: A choice to buy or sell metal at an agreed-upon price for a specific date. You must pay a premium (See Put and Call).
Pickling: Treating the surface of iron or steel with acid to remove scale, rust and dirt, preparatory to further processing such as cold rolling, tinning, galvanizing, polishing, etc.
Pig iron: The product of the blast furnace, when cast in a pig bed or in a pig-casting machine. It derives its name from the fact that the channel or runner leading from the furnace branched out into side channels called sows, and then into smaller channels called pigs. Pig iron today is sold on chemical analysis.
Plate: Wide, flat-rolled steel. It is now generally accepted that steel more than 3 mm (1/8 inch) thick is plate and less than 3 mm is sheet (See Sheet).
Premium: Cost of an option and/or an amount added to a base price for a material, i.e. added cost beyond the base Comex, LME and/or producer and manufacturer prices.
Put: An option, but not an obligation to sell. Nonferrous metal producers often buy puts to lock in a price for their metal. It is akin to a price insurance policy. For example, if a producer uses put options to lock in a price of 90 cents per pound and the price falls to 85 cents per pound, he would continue to make 90 cents per pound (See Options and Call).
Refractory: A ceramic material that can resist great heat and is therefore suitable for lining furnaces. Fireclay, dolomite, magnesite and silica are examples. This is not to be confused with refractory metals, such as columbium and tantalum.
Reversing mill: Any rolling mill in which the direction of rotation of the rolls can be reversed at will. Heavy primary mills for bloom and slab rolling are the most common, but others, including some cold-rolling mills, are also made to reverse.
Rod: Rolled steel or steel with a circular cross section can be a bar, a rod or a round, and there is no generally accepted firm dividing line. Broadly, a rod is from 3/16 to 1/2 inch in diameter. Rods today are usually rolled in long lengths and coiled.
Scale: Oxide of iron that forms on the surface of steel after heating.
Semi-finished steel: Steel shapes, for example blooms, billets or slabs, that later are rolled into finished products such as beams, bars or sheet.
Sheet: Wide, flat-rolled steel. It is generally accepted that steel less than 3 mm thick is sheet and more than 3 mm (1/8 inch) thick is plate (See Plate).
Short: In commodities market parlance, selling more futures contracts than you buy.
Slab: A semi-finished, hot-rolled section of flat-rolled steel, prepared for rolling down to plate or sheet. It is generally more than 1 1/2 inches thick and more than twice as wide as it is thick.
Slag: a) The non-metallic material forming a molten layer on top of the molten steel in a steel furnace. It is made by charging suitable materials and plays an important role in the refiningh of the steel. b) Loosely applied to any waste material drawn off in molten form.
Smelter: Facility is used to extract metal concentrates found inside mined ore. The ore will often contain more than one kind of metal concentrate and this facility also separates them.
Specialty steel: Steels such as electrical, alloy or stainless steels. These generally are produced in smaller volumes to meet the specific needs of customers.
Spot material: Metal or finished products available for prompt delivery.
Strip: Steel rolled out into long, thin, flat strips. Steel up to about 24 inches wide is strip or narrow strip; above this, wide strip. The dividing line is sometimes said to be 18 inches, but 24 inches is more generally accepted.
Tailings: The end-product or waste of ore mining, usually piled up in close proximity of a mining area. Some will often contain some metal that can be extracted.
Tempering: Also known as drawing, the process by which steel or iron is softened by reheating it at a considerably lower temperature than that at which its previous hardening was done.
Tinplate: Thin steel sheet with a very thin coating of metallic tin. Used primarily in can-making.
Ton, gross: 2,240 pounds. Standard measurement in steel scrap pricing.
Ton, long: 2,240 pounds.
Ton, metric: 2,204.6 pounds. It is often spelled "tonne" to distinguish it from other standard ton measures.
Ton, short: 2,000 pounds. Often called a net ton.
Tool steels: Steels that are hardened for the use in the manufacture of tools and dies.
Trailerload, truckload: quantities of commodities, including primary and secondary metals, that amount to as much as 44,000 pounds each, which is the standard weight limit on U.S. highways.
Used beverage cans (UBCs): scrap aluminum beverage cans, although sometimes applied to steel cans as well (steel has a microscopic share of the beverage can market in America but a much larger share in Europe and elsewhere).
Vacuum degassing: A process by which the amount of carbon in the steel is reduced by exposing liquid steel to a very low vacuum environment. Carbon combines in the process with oxygen to form carbon monoxide, which is removed in the process. The result is a steel that contains lower levels of carbon and thus, has higher formabiliy.
Walking beam: A means of conveying steel bars, billets, slabs, etc., across a cooling bed or through a furnace. The material to be conveyed rests on a metal grid and a second grid is arranged to lift up and move forward between the stationary grid, thus lifting the material and "walking" it forward, before returning to make another stroke.
Z-mill: Common name for a Senzimir multiple-backup cluster mill used for cold-rolling stainless and carbon steel sheet or strip to very precise dimensions and fine finishes.
Zinc galvanizers' dross: A grade of scrap that can either be top dross or bottom dross, generated at electro-galvanizing and continuous hot-dip plants serving the steel industry.
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