Material Insights · Understanding the Material World

Cement and Steel

Granulated blast furnace slag from ironmaking is ground into GGBS and slag cement to replace clinker, and both materials depend on construction demand; in India, JSW Steel's slag feeds JSW Cement, the largest GGBS maker.

Cement (commodity) and Steel (commodity): 4 relationships.

How they are linked

1. Slag replaces clinker

Joint production · Strong · Steel (blast furnace) → slag cement and GGBS

Granulated blast furnace slag has cement-like properties, so ground slag can replace part of the clinker in cement or concrete, using a steel by-product and cutting emissions.

  • about 400 kg co-products per tonne of steel, blast furnace and basic oxygen furnace route
  • about 90% slag share of those co-products, by mass
  • up to 59% cut in embodied CO2 when slag cement replaces portland cement in concrete

worldsteel lists blast furnace slag as a substitute for clinker in cement making. Slag supply is set by blast furnace output, not cement demand, so cement makers near steel plants gain a low-carbon binder whose volume they cannot control.

Sources: World Steel Association

2. Steel and cement in one group

Geography and ownership · High in India · JSW Steel supplies slag to JSW Cement

JSW Cement buys blast furnace slag from JSW Steel under long-term contracts and grinds it into GGBS and slag cement.

  • about 84% JSW Cement share of India's GGBS market, FY2024-25
  • 20.60 MMTPA JSW Cement grinding capacity, March 2025

The arrangement turns a steel waste stream into a cement product, and it ties JSW Cement's growth to JSW Steel's blast furnace output.

Sources: Arihant Capital

3. Shared construction demand

Shared risk · Medium · Construction demand → both

Buildings and infrastructure are the main market for cement and a large market for steel, so a construction slowdown hits both.

  • about 31% construction share of US steel net shipments, 2025
  • about 160 Mt India's raw steel output, 2025

Steel also serves vehicles, machinery and packaging, so its exposure to construction is smaller than cement's. In India, public infrastructure spending is a common driver of both rebar and cement demand.

Sources: USGS

4. Steel route shift and slag supply

Transition · Weak · Fewer blast furnaces → less slag for cement

Electric arc furnace steel produces about half the co-products of the blast furnace route, and it is blast furnace slag that is used as a clinker substitute.

  • about 200 kg co-products per tonne of steel, electric arc furnace route

As steel decarbonises by moving from blast furnaces to scrap or direct reduced iron with electric furnaces, the supply of blast furnace slag for cement would shrink, so cement decarbonisation cannot rely on slag alone in the long run.

Sources: World Steel Association

For investors

Key learnings

  1. Slag is a link where steel output sets the supply of a cement input, so slag cement volumes follow blast furnace output, not cement demand.
  2. JSW's integration shows the value of owning both ends: about 84% of India's GGBS market in FY2024-25.
  3. Steel's shift away from blast furnaces would reduce slag supply over time, raising the value of other clinker substitutes.

What to track

  • Indian blast furnace hot metal output: Volume of slag available to cement makers (Monthly · Joint Plant Committee)
  • Slag cement share of cement output: Uptake of steel by-product in cement (Yearly · company reports, Cement Manufacturers' Association)
  • Cement and steel demand from public infrastructure: Shared construction cycle (Quarterly · Union Budget capital spending, company results)

For policymakers

Key learnings

  1. Using blast furnace slag in cement cuts emissions from both industries and keeps slag out of dumps.
  2. Procurement rules that accept slag cement and GGBS in public works expand the market for this by-product.
  3. Long-term cement decarbonisation plans need to allow for less blast furnace slag as steel shifts route.

What to track

  • Share of slag and blended cement in public procurement: Market access for steel by-products (Yearly · public works departments)
  • Blast furnace and electric furnace steel output: Future slag supply (Monthly · Joint Plant Committee)

India

India made about 160 Mt of raw steel in 2025, and its blast furnaces supply slag to cement makers; JSW Cement, using slag from JSW Steel, held about 84% of the GGBS market in FY2024-25.

Sources

  1. Steel industry co-products (policy paper), World Steel Association
  2. JSW Cement IPO note, Arihant Capital (2025)
  3. Mineral Commodity Summaries 2026: Iron and Steel, USGS (2026)