‘Flash Ironmaking’ and Beijing’s Lead in Industrial Technologies

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Wenhai Zhang delivers remarks at a recent conference. (Source: Chinese Academy of Engineering)

Executive Summary:

  • A new “flash ironmaking” technology invented in the People’s Republic of China’s (PRC) reduces reliance on imported high-grade iron ore, aligning with Xi Jinping’s push for industrial chain autonomy and supply chain resilience.
  • The technology may mitigate geopolitical risks but is unlikely to disrupt Australia’s iron ore market in the near term.
  • The PRC could export this technology through the One Belt One Road initiative, fostering industrialization in developing countries and solidifying its global leadership in metallurgy.

The year 2025 marks the final year of the People’s Republic of China’s (PRC) 14th Five-Year Plan. Xi Jinping has emphasized the importance of securing victory in this “final battle (收官之战)” by urging the nation’s industrial sectors to “steadily advance high-quality development, better integrate development and security, and vigorously promote a new model of industrialization (扎实推动高质量发展，更好统筹发展和安全，大力推进新型工业化).” The “new” in this “new model of industrialization” is reflected in “enhancing technological innovation within industries, upgrading and transforming traditional sectors, and consolidating and advancing competitive industries (提升产业科技创新能力，改造升级传统产业，巩固提升优势产业)” (Gov.cn, December 27, 2024; Jiangsu Provincial Party Committee, January 14).

In late November 2024, Professor Wenhai Zhang (张文海), an academician of the Chinese Academy of Engineering (中国工程院), published a comprehensive review paper on the latest advancements in “flash ironmaking (闪速炼铁)” technology and its potential for future industrialization. Flash ironmaking represents a significant improvement over traditional blast furnace processes, particularly in its ability to reduce reliance on high-grade iron ore and minimize energy consumption. The technology has reached the pilot testing phase, demonstrating high stability and the potential for industrial-scale production with an annual capacity of over one million tons. Zhang’s paper notes that the People’s Republic of China (PRC) has already commenced commercial production of a key piece of equipment required for large-scale industrial application of flash ironmaking, a device known as the “swirling column nozzle with high uniformity performance (高均布性能的漩涡矿砂喷枪).” [1]

The PRC is the world’s largest steel producer, accounting for approximately 56 percent of global crude steel production in 2023, with an output of over 1 billion tons (C Steel News, January 29, 2024). However, the country remains heavily reliant on imported high-quality iron ore from countries such as Australia and Brazil due to the relatively low grade of its domestic ore (Oriental Securities, May 26, 2021). This poses risks to supply chain security, particularly given current geopolitical tensions. Against this backdrop, the industrialization of flash ironmaking technology is vital for reducing dependency on imports and bolstering supply chain resilience.

Wenhai Zhang: Metallurgy Pioneer

Professor Wenhai Zhang is a pivotal figure in the PRC’s metallurgical sector. His most notable achievement is the development of the “flash copper smelting (闪速炼铜)” technology in the late 1970s, which addressed major challenges in the production process while reducing energy consumption (Baidu Baike, May 23, 2024). Building on this expertise, Zhang and his team are now advancing flash ironmaking to enhance the PRC’s industrial independence. In addition to his technical contributions, Zhang has played a key role in exporting PRC technologies to other countries, exemplified by the completion of a major copper smelting project in Iran in 2004 (Nerin, June 14, 2024). [2]

Zhang’s work outstrips that of U.S. competitors. At the University of Utah, Professor Hong Yong Sohn has also conducted research on flash ironmaking, with support from the U.S. Department of Energy. Although Sohn’s research began earlier, Zhang’s team quickly caught up, and has since deployed a larger pilot facility, capable of testing production at a significantly higher scale (Department of Energy, December, 2016). While Sohn focuses on the environmental benefits of this technology, Zhang emphasizes its potential for industrial scalability. This plays into the PRC’s strengths as an industrial powerhouse.

Australia Fears Increased PRC Self-Reliance

Australian media has expressed concern over the potential impact of PRC’s advancements in flash ironmaking technology on its economy, particularly its iron ore exports. Reports highlight that the PRC’s progress in reducing reliance on imported iron ore could significantly disrupt Australia’s resource-driven economy (News.com.au, December 10, 2024). With geopolitical tensions escalating, these developments are seen as part of the PRC’s broader strategy to achieve industrial and economic independence.

These concerns may be somewhat overstated. Previous breakthroughs in the PRC’s metallurgical technologies have not done much to affect the country’s need for imports: High-grade copper ore prices have continued to rise since the 1970s, with no significant reduction in market demand. This demonstrates that high-quality raw materials still maintain a competitive advantage in cost efficiency. Similarly, while Zhang’s new “flash ironmaking” technology enables the use of low-grade iron ore and improves resource efficiency, the importance of high-grade iron ore from Australia is unlikely to diminish as rapidly as some fear.

For the PRC, the introduction of the “flash ironmaking” technology will serve more as a contingency plan to address external uncertainties. This innovation provides a strategic tool for risk mitigation, offering the PRC’s heavy industry a safeguard against potential disruptions in raw material imports, particularly in the context of increasing geopolitical tensions.

Strategic Technologies Beyond the ‘Chokepoints’

The breakthrough in flash ironmaking technology aligns closely with Xi Jinping’s strategic objective of developing “new productive forces (新质生产力)” in the economy. As Xi emphasized during a Politburo group study session in early 2024, “industrial chains must be planned around the development of new productive forces to enhance the resilience and security of supply chains, ensuring that the industrial system remains self-reliant and reliable (要围绕发展新质生产力布局产业链，提升产业链供应链韧性和安全水平，保证产业体系自主可控、安全可靠)” (Qiushi, February 7, 2024). By efficiently utilizing low-grade iron ore and reducing dependency on high-grade iron ore importation, “flash ironmaking” serves as a direct response to Xi’s call for greater industrial chain autonomy.

In recent years, analysts have predominantly focused on the PRC’s breakthroughs in “chokepoint technologies (卡脖子科技),” such as advancements in AI algorithms and semiconductor development, and how these achievements align with Xi Jinping’s vision of “self-reliance (自主)” (China Brief, December 1, 2023; May 10, 2024). However, less attention has been paid to how the PRC leverages updates to its existing technological advantages to maintain the leadership it already holds. While Beijing’s industrial policies prioritize overcoming chokepoint technologies, the PRC does not consider them the only strategically important areas.

Beyond consolidating its existing technological edge, this new metallurgical technology could inject fresh momentum into the One Belt One Road (一带一路) initiative. Like the earlier export of flash copper smelting technology, the PRC may share this advanced ironmaking technology with developing countries. This could support their industrialization while reducing dependence on Australian resources and deepening their economic reliance on the PRC. The United States currently appears unable to compete with PRC firms. The Biden Administration’s controversial decision to veto Nippon Steel’s acquisition of U.S. Steel on national security grounds could persuade other countries to invest in the PRC, or in other Asian emerging markets where the PRC can actively transfer its metallurgical technology, such as Pakistan, Kazakhstan, and Middle Eastern nations. These dynamics not only bolster the PRC’s leadership in global technology markets but also enhance its influence among developing nations, contributing to the formation of a PRC-centered global metallurgical network.

Conclusion

The PRC’s new flash ironmaking technology may represent a notable breakthrough in the metallurgical sector, but its impact should be viewed with a degree of caution. High-grade iron ore from major exporters like Australia will likely remain essential due to cost efficiency and established infrastructure. The technology’s role may be better understood as a strategic hedge against potential disruptions, offering the PRC a degree of autonomy in its heavy industries. Over time, if scaled successfully, this innovation could reshape resource dependency and further solidify the PRC’s influence in global industrial chains. For now, its transformative effects are more aspirational than immediate.

Notes

[1] Zhang, Renjie & Zhang, Wenhai, Research Progress of Flashing Ironmaking. Nonferrous Metals, November 2024.

[2] According to the website of China Nerin Engineering Co., Ltd., where Wenhai Zhang serves as a Senior Technical Advisor, the company has exported metallurgical technologies not only to Iran for its copper smelting project but also to countries such as the Philippines, the Democratic Republic of Congo, Indonesia, India, Serbia, and even developed Western nations like Germany and the United States. For more details, visit: http://www.nerin.com/html/cn/Project/metallurgy/.