A broader, more robust LKAB

October 26, 2018
In addition to finding new deposits, LKAB must diversify in order to better meet fluctuations in the iron ore market. Photo: Lars-Göran Kalla

To complement iron ore production and better meet fluctuations in the iron ore market LKAB must broaden its business."We are already well on the way with the expansion of LKAB Minerals and collaboration with RagnSells can open new markets. We cannot discount future acquisitions," says Jan Moström, LKAB's President and CEO.

The new LKAB will aim for a broader presence on the minerals market. Subsidiary LKAB Minerals recently acquired the British company Francis Flower, which recycles blast furnace slag. Another example is the joint project with the Ragn-Sells subsidiary EasyMining, whereby phosphorus and rare earth metals will be recovered from LKAB’s waste streams. There is a shortage of both phosphorus and rare earth metals on the world market.

“With our engagement in markets for special products, we can make LKAB broader and more able to withstand fluctuations in the iron ore market. LKAB must also secure the financial resources needed to diversify the company. A strong financial base not only creates the conditions for developing the core business, but also for growth through acquisition of other businesses such as mines and minerals companies,” says Jan Moström.

Initiatives such as HYBRIT, SUM and a broadening of LKAB will demand investment on a very great scale. Therefore, LKAB must improve efficiency in operations on an ongoing basis to ensure the sustained profitability that is necessary for continued growth and investment. LKAB is also dependent on public-sector policy and decisions at the local-government, county and national levels. It is therefore crucial that permitting and planning processes are effective, just, predictable and long-term.

“We have been pursuing the issue of permit processes for years, both on the part of the company and via our industry organisation Svemin. It is not a matter of demanding more lenient environmental requirements or exemptions; we are prepared to assume our responsibility for causing as little environmental impact as possible. It has to do, instead, with achieving better predictability in permit processes, so that we are better able to plan, for example, for the start of new mines,” says Jan Moström.