MINI-MILLS: The new look of Steel Mills

Electric mini-mills are fast raplacing the more traditional blast furnace steel mills of the past.  In a mini-mills, electricity is used to melt (primarily) scrap steel.   The diagrams below show the steps that traditional steel mills must take, to make steel from ore, coke, and limestone.  It also shows how mini-mills streamline this process considerably.
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Minimills make steel from scrap steel or scrap substitutes in an electric arc furnace (EAF). Electric furnace steel, like integrated steel, is then cast into the semi-finished forms. Because an integrated process takes more steps (i.e., coke batteries, blast furnaces), is more capital intensive, and traditionally requires more man-hours per ton, the minimills have used their cost advantage to take share away from the integrate steel mill+blast furnace operations. However, as the price of the raw materials that go into an electric furnace, i.e. scrap, has increased, the cost advantage of the minimills has diminished. The integrate mills, too, have brought their costs down at the same time. Generally, if scrap is above $160-170 per ton, the minimill cost advantage disappears.
To operate a minimill, an electric arc furnace is usually filled or charged at the top with scrap steel. A typical 200,000-300,000 ton per year electric furnace would be 25-30 feet in diameter. A large electric current is sent to the furnace via carbon graphite electrodes. Between the electrodes an electric arc forms, creating enough heat (3,500 degrees F) to melt the scrap. The electrodes, which look like thick, short telephone poles, are pure carbon. As the electric arc melts the scrap, the steelís chemistry is periodically tested, and with the addition of iron or alloys into the mix, new steel is made with the desired specifications. As in the integrated process, a ladle met station might be employed after the EAF process for final chemistry trimming before the steel heads to a caster.


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