The Beehive Oven Era. The quest for a suitable fuel for smelting iron ore in the blast furnace led first to the beehive oven. This type of oven was.

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Reprinted from The Journal of Land & Public Utility Economics Vol. XXII, No. 4, November, 1946 By WALTER 13. VQSKUIL* T HE primary function of coke is to reduce ores to the metallic state. Whatever other uses may have been found for coke or to whatever other uses it has been put they are but inci- dental in the economic significance of this material. The reduction of iron ore in the blast furnace using coke as a fuel is so far superior in terms of econ- omy than any other method of ore re- duction that there are no rivals. This is of fundamental significance for it is at present the only means which we know of for obtaining iron cheaply. The other uses of coke, such as house heating and gas making, are incidental contributions and refinements in a tech- nology which became possible only af- ter low-cost smelting of iron ores was accomplished. Coke is an artificially prepared fuel, the residue that remains after certain bituminous coals have been subjected to destructive distillation. Due to its porous structure, hardness, strength, and size, it has become the chief metallur- gical fuel. The evolution of the coke manufac- turing process, first in the beehive oven and more lately in the modern by- product oven, stands as one of the sig- nificant developments in the transfor- mation of industrial society from the handicraft and semi-handicraft stage to a power-operated economy. For, in ad- dition to its unique characteristics as a fuel for the reduction of iron ore, coke supply freed the metallurgical industry from the sharp limitations of fuels hith- erto available for smelting ores-char- coal and anthracite. With the advent of the coke oven * Chief Mineral Economist, Illinois Geological Survey. and the blast furnace, the requisites for industrialization – cheap steel – emerged into a reality. These two in- struments of production, the coke oven as the producer, in mass tonnages, of a requisite fuel, and the blast furnace, the highly efficient producer of pig iron in mass tonnages, are the gateways to a highly productive, versatile, complex in- dustrial economy. Other methods of obtaining raw iron and steel have been proposed but, to date, none show any possibility of replacing the blast fur- nace with heat supplied by coke. The coke oven, then, together with the blast furnace, becomes the symbol of productiveness, the basis of a high standard of living, of power. Metallurgical Coke, Other Coke, and By-Products In its function as a metallurgical fuel, coke is a key material in the industrial process. The development of this fuel and its primary purpose is the need of a satisfactory smelting fuel. Today, its usefulness goes far beyond the need for smelting. Coke is used as a domestic fuel, in nitrogen fixation, gas manufac- ture, atld as a smolceless fuel in certain industries. The by-products, recovered from the destructive distillation of coal, supply ammonium fertilizers, gas, a mul- titude of tar products and light oils suitable for motor fuel and for chemi- cal raw materials. These other uses, while performing no fundamental role in the functioning of our industrial economy, do never- theless, increase substantially the ag- gregate value of the products of the coking process and, in this respect, tend to decrease somewhat the cost of metal- lurgical coke. The value of these by-

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340 THE JOURNAL OF LAND & PUBLIC UTILITY ECONOMICS product industries is brought out by a consolidated balance sheet of costs and realizations of the beehive and by-prod- uct processes. BALANCE SHEET FOR PREWAR YEAR, 1939 ( Thozi.rands of dollars) Ry-produc t Beehive Ovens Ovens Value of coal changed . $ 229,786 . . . . $ 4,584 Value of coke. . . . . . . . . . 206,457 . . . . 6,426 Value of all products coke, breeze, and by-products. . . . . . . . . 348,625 . . . . 6,488 The Evolution of Coke Manufacture The Beehive Oven Era. The quest for a suitable fuel for smelting iron ore in the blast furnace led first to the beehive oven. This type of oven was singularly well adapted to the early era of the iron and steel industry. Coke was needed primarily for iron ore smelting. There was no demand for other uses or customers. The art of by- product recovery was then unknown and it is doubtful if a profitable mar- ket for by-products could have been readily developed. The ‘elaborate in- dustrial economy with its intricate inter- relationships among industries, the use of by- or waste-products of one as the raw material for another was, at best, but feebly developed. The iron industry needed a hard, porous, quick- burning fuel for smelting, and it ob- tained this fuel by di’stilling off the vol- atile contents of a suitable coal. In an economy just emerging from a dom- inantly agricultural state into an in- cipient industrialism, the beehive oven was the only practical instrument for the manufacture of a metallurgical fuel for the expanding pi’g iron. industry. In spite of its wastefulness of the vol- atile ingredients of coal, the beehive men, nevertheless, fitted the economy of its day. Capital requirements were small by comparison to the modern oven. The ovens were located near the source of coal which, in the early days of the iron industry, were in the Pitts- burgh district, and this effected econo- mies in assembly of materials. Today the beehive oven is relegated to a minor role in the coke manufacturing indus- try. It still plays a useful role as a means of quickly expanding coke pro- duction in small increments where rap- id expansion of coke was essential, or to reduce output, at a small expense of plant write-off in a period of declining coke demand. The first beehive oven appears to have been put into operation in 1841 and the first successful use of coke as a blast-furnace fuel was thoroughly dem- onstrated in 1859 in Pittsburgh. From that time the output of coke increased rapidly. The By-product Era. The first bat- tery of Semet-Solvay by-product coke ovens was built at Syracuse, New York, in 1893. The output of by-product coke that year was 12,850 tons and rep- resented 0.1 per cent of the year’s out- put. From that date there was a steady and noteworthy increase in construction of by-product ovens. By 1919 the aut- put of by-product coke exceeded that of the beehive oven and by 1937 the latter was reduced to a contribution of six per cent of the total output. Only the exigencies of a world at war and the immediate need of a rapid increase in coke output brought about an upturn in beehive coke manufacture during the war years. The displacement of the bee- hive oven in favor of the by-product oven was inevitable. The advantage whi’ch the by-product oven has over the beehive lies in a number of factors: 1. The by-product coke plant can be constructed at or near the blast furnaces

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COKE-A KEY INDUSTRIAL MATERIAL 341 which are to consume its coke, and thus be under the same management. 2. It is practicable to ship to it coking coals from any section within a radius of a favorable freight rate. 3. Many coals not suitable for coking in beehive ovens become available for by- product ovens by mixing with other coals and are so used to make a first-class blast furnace coke. 4. Coking coals in by-product ovens permit of the full recovery and use of the very valuable by-products and the gas. 5. The cost of making by-product coke at the iron and steel works is considerably less than the cost of making beehive coke at the coal mines and transporting the coke to blast furnaces, especially when lo- cated some distance away from the beehive districts. The Economic Function of By-Products The recovery and sale of by-products increases substantially the realization from coke oven operations. In the year 1944, for example, the balance sheet was as follows: Cost of coal at the plant. . . . . . . . . . $480,197,510 Value of coke produced.. . . . . . . . . . 478,844,172 Value of by-products sold. . . . . . . . . 210,065,863 Value of coke produced and by- products sold. . . . . . . . . . . . . . . . . . 686,910,035 Besides coke, the primary by-products of the coking process. are gas, tar, am- monia, and light oil. It is evident from the most cursory considerati’on of the by-products business that the coke in- dustry sells to its immediate users al- most nothing but fuels. Coke goes to the blast furnace or foundry; gas is sold to industrial plants or to house- holders for heating and cooking; tar is often sold for use as fuel. But when these or other products of coal carboni- zation are used for purposes other than fuel they usually become raw materials for manufacture of other products, which in turn are sold once or many times before reaching the ultimate user. The production of one coal product is invariably accompanied by all the oth- ers. Under these circumstances the im- portance of properly balanced demands for coke, gas, tar, and other products is a matter of concern to the plant oper- ator. For the past three decades approxi- mately 80 per cent of the by-product coke manufactured in the United States has been used as blast-furnace fuel. This is an important factor in the or- ganization of the coke industry and in the nature of the by-products market. The blast furnace operator must be assured of a dependable supply of coke and for these reasons alone a steel com- pany is likely to prefer to own and operate its own coke plant. Further- more, the cost of coke is one of the largest single factors in the cost of pig iron. Hence, maximum economy in manufacturing coke is essential. In an integrated steel plant comprised of coke ovens, blast furnaces and steel hearths, substantial economies can be effected by an interchange of by-products from one of the units of the integrated plant for use in the process in another of the units. For example, by-product gas from the coke oven can be used to heat the stoves and to fuel the com- pressor engines of the blast furnace or to supply fuel for the open hearth steel furnace. Also, the molten pig iron may be transferred to the steel plant from the blast furnace for conversion into steel without solidifying, thereby ef- fecting economy in heat requirements. Si’nce it is an exceedingly costly u11- dertaking to begin or cease operations of a by-product oven, the manufacture of coke is somewhat inflexible and, at every depression in the steel industry, some of the metallurgical companies owning coke works are likely to become sellers of coke. Often the result is to

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342 THE JOURNAL OF LAND & PUBLIC UTILITY ECONOMICS break the spot market price for coke and cause the contract market to sag, to the disadvantage of the operator of a merchant coke plant. Tlze Kinds and Diverse Sources of Coke. The term “coke” is used in con- nection with a number of fuels manu- factured by various methods and for different purposes. These fuels have one characteristic in common-low volatil- ity. In the fuel industry, these are rec- ognized: Beehive and by-product coke; gas house coke; petroleum coke; low- temperature coke; and special and semi- coke. The uses of these several types of coke falls into two classes insofar as their function in industry is concerned -metallurgical and “all other” uses. Of the types of coke listed above, bee- hive and by-product coke is manufac- tured primarily for use as a metallurgi- cal fuel, but it has also found a consid- erable market as a domestic fuel and performs a very important service in industry as a fuel and raw material for the manufacture of fixed nitrogen. There are other miscellaneous uses. Gas house coke is the by-product of an industry, the primary objective of which is the manufacture of gas. The coke is merely a product to be offered in a competitive domestic fuel market. This is also true, largely, of petroleum coke, although this material, by reason of its negligible ash content, is useful for the manufacture of electrodes and some of it is used as such. Low-temperature coke and semi-coke are products which represent attempts to improve upon bituminous coal as a domestic fuel or to produce a smokeless fuel. Because a process of this kind adds to the cost of the fuel and is ac- companied by certain undesirable char- acteristics, such as an increase in the percentage of ash content, the result in terms of total demand for domestic fuels is as yet rather inconsequential. The Source of Coking Coal. Coals suitable for the manufacture of metal- lurgical coke are restricted in geograph- ical distribution and possibly limited in quantity. Hitherto the principal sources of coking coal have been Pennsylvania, West Virginia, Alabama, and eastern Kent~lcky. Minor quantities have been contributed by other states east of the Mississippi River. Illinois shows prom- ise of increasing its hitherto small con- tribution to the total supply. Colorado, New Mexico, and Utah supplied coking coal to the local iron industry in Col- orado. These are currently the states from which coking coal is obtained. Technological advances may widen the range of coals that may be converted into metallurgical coke. This happened in the change from beehive to by-prod- uct coke manufacture. Researches in coke production give evidence of such extension of coals suitable for c0king.l Also, coking coals no doubt exist in the vast reserve of coal west of the Missis- 1 sippi River, where demand, except lo- cally, is non-existent. T11e Relatiorz of Coking Coal and Steel Mnnz~fncfzue. Since the steel in- dustry is the most important user of coke, the geographical pattern of coke manufacture and coking coal move- ments are largely determined by steel plant location. Five s tee1 districts dom- inate the picture and the relation of the coke industry to these centers will be considered. In 1945 these steel cen- ters consumed coking coal in the order indicated in Table I. The Coking Coal Movement. In an- alyzing the distribution of coke into the markets, we are concerned with two sets of shipments, i. e., (1) the movement of coking coal to the ovens for process- 1 Illinois Geological Survey studies.

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COKE-A KEY INDUSTRIAL MATERIAL 343 TABLE I. BY-PRODUCT COKE PRODUCED IN THE UNITED STATES IN 1944 AND 1945, BY GEO~RAPHICAL DISTRICTS, IN THE IRON AND STEEL INDUSTRY ing, and (2) the distribution of coke from the ovens. The close association of by-product coke oven with the steel plant, and the location of important steel centers near markets rather than near ore bodies, Chicago, Sparrows Point, or Buf- falo, as examples, makes the movement of coking coal, in some instances, neces- sarily long. This is particularly the case of coking coal consumed in the Chicago district. In consTdering in de- tail the nature and pattern of coking coal movements, we must take cogni- zance of three major sources of coal supply and five major coke manufactur- ing districts. The sources of supply are the northern Appalachians (Pennsylva- nia and northern West Virginia), the southern Appalachians (southern West Virginia, Virginia, and leastern Ken- tucky) and Alabama. The coke manu- facturing districts are Eastern, Pitts- burgh-Youngs town, Cleveland-Detroit, Chicago, and Southern .” Possibly the ideal situation exists in Alabama where coking coal, iron ore, and fluxing stone are practically adja- cent to one another and where assembly costs are lowest of all in the United States. Coke at the plant is valued at $5.33 (1944) which is the lowest of all the steel districts and to which costs Coal Changed (000 net tons) DISTRICT 1944 1 1945 The western producing and manufacturing dis- trict will be discussed separately. Eastern. . . . . . . . . . . . . . . . . . . . . . . . . Pittsburgh-Youngstown. . . . . . . . . . . Cleveland-Detroit. . . . . . . . . . . . . . . . Chicago. . . . . . . . . . . . . . . . . . . . . . . . Southern. . . . . . . . . . . . . . . . . . . . . . . . Western.. . . . . . . . . . . . . . . . . . . . . . . in only one other district, Pittsburgh- Youngstown, are comparable. Coal for the ovens in Pennsylvania, Ohio, and western New York is sup- plied, in the main, from Pennsylvania and northern West Virginia sources, al- though eastern Kentucky has, in recent years, become a substantial contributor. The third major source of coking coal, the southern Appalachians, differs from the Pennsylvania and Alabama coal dis- tricts in having only a limited outlet near at hand. By far the major portion of this coal is shipped to distant markets, principally in Illinois, Indiana, Ohio, Maryland, Michigan, and Massachusetts. Two-thirds of the coking coal produced in West Virginia, Virginia, and eastern Kentucky is shipped to these six states. Indiana and Illinois obtain 96 per cent of their requirements from the southern Appalachian fields. Coke Produced (000 net tons) 22,330 23,500 9,293 18,143 11,575 2,696 Interrelation of Coking Coal Markets and Domestic Fuel Markets in the Chicago district 1944 16,511 18,381 7,189 14,484 8,769 1,730 Per Ton Value Coke at Ovens The Chicago district is a large con- sumer of prepared sizes of coal imported hom the Appalachian fields for use in domestic heating and in small commer- cial and industrial establishments. The southern Appalachian district supplied nearly 40 per cent of the coal sold to retail yards. This large shipment must be interpreted in connection with the 1945 15,868 16,485 6,681 13,193 8,241 1,626 1944 $8.12 5.55 7.75 8.62 5.33 8.94 1945 $8.45 6.02 8.32 8.91 5.90 9.32

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COKE-A KEY INDUSTRIAL MATERIAL 345 portant element in the cost of pig iron production. The principal source of coking coal for both eastern and lake states blast furnace locations has been the thick, low- cost, easily minable seams of the Pitts- burgh district and the low volatile coals of southern West Virginia and eastern Kentucky. That these choice coals are not inexhaustible is pointed out in a re- port by the National Resources Planning Board in their report entitled Energy Resources and National Poli~y.~ “Depletion is becoming evident in some comparatively large areas . . . The high quality smokeless coals of southern West Virginia in beds 3 feet or more thick will last only about 85 years at the 1929 rate of mining. The life of the great Pitts- burgh bed in Pennsylvania is limited to 100 years at the 1929 rate of production, and the Connellsville coking coal in the Pittsburgh bed, which contributed heavily to the development of the iron and steel industry, probably will be sufficient for only 20 or 30 years.” Long before exhaustion occurs, the effect of depletion of the more favorably situated and better rank coals will be- come manifest. When the reserve sup- ply begins to decline, it will do so at the most vulnerable points. The pat- tern of industrial location, having a di- rect dependence on low-cost coal, may have to be reshaped, as soon as the pinch of exhaustion, or even partial deple- tion, is felt. Extensive transportation of coal makes the delivered price of coal prohibitive for industrial purposes. Since transportation costs on coal over a distance of a thousand miles or more would be so high as to make the deliv- ered cost prohibitive, the solution of a possible decline in coking coal reserves in the Appalachian field does not lie in the development of coking coals in the western Mountain States. But, since — – 3Report, Energy Resources Committee to the National Resources Committee, 1939, p. 64. the question of the adequacy of coking coal reserves in the Appalachian area has been raised by students of the industry, the issue must be examined in the light of available data. One aspect of depletion of coking coal reserves is the quantity of coking coal mined and not used for the manufac- ture of metallurgical coke. A survey made by the Bureau of Mines of coking coal produced in 1940 discloses that counties producing coking coal shipped a total of 171,440,000 tons of coal of which 76,582,780 tons were made into coke, or about 45 per cent of this total, 158,og 1,000 was produced in the Appala- chian coal-producing states of Pennsyl- vania, West Virginia, Virginia, and Ken- tucky, of which 6~~,060,ooo was used in coke manufacture. Meanwhile, the total production of bituminous coal in the United States in 1940 was 460,771,rjoo tons. Of this, 17 1,440,ooo tons, or 37 per cent, was suitable for coking but not all so used. An examination of coal production by counties in Pennsylvania, West Vir- ginia, and Alabama covering the period 1 g i 6 to 1944 shows a substantial decline in output in such important coal coun- ties as Alleghany, Fayette, and West- moreland in Pennsylvania, offset by an increase in practically all counties pro- ducing coking coal in West Virginia. Meanwhile output in Alabama remained relatively unchanged. These brief and incomplete notes on the reserve picture of coking coal are merely intended to serve as a suggestion that, in view of the key role of coking coal in the continued functioning of an industrial economy, a detailed examina- tion of the resources and the establish- ment of a tentative inventory would serve as a useful guide in directing re- search on coking coal problems and in the formulation of a fuel policy.

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