Localisation factors
Steered by natural resources
In earlier times, iron mills were located close to the natural resources on which they depended. In Bergslagen iron ore was found in a large number of smaller mines, hydropower was utilised to operate 
blast furnace bellows and forge hammers, and charcoal was obtained from the vast forests. In winter the finished iron could be transported over the ice to the markets in Sweden’s towns and cities. The illustration shows a very large hammer (mumbling hammer) operated by hydropower (Löfsta Bruk 1923).
Industrialisation
During the great age of industrialisation, the introduction of steel cast in ingots, from the 1860’s, meant that steel could be manufactured in very large quantities at much lower cost. Prices fell, demand grew and far-reaching rationalisation led to steel production being concentrated at larger plants in fewer places.
The factors that influenced the choice of location now changed. Power, iron ore and coal were still required. Proximity to watercourses became less important in line with the advance of electrification at the same time as iron ore and coal were demanded in much larger volumes. It was for this reason that the new ore-based steel industry came to be located on the coast above all, where ships were able to deliver their cargoes of iron ore and coal.
Electrical power acquired great importance for the electro-steel process that was developed at the beginning of the 20th century. In this process, recycled steel scrap is used as the raw material. Plants with scrap-based steel production were then able to be located near densely populated industrial areas where both the markets and the raw material could be found. This frequently meant that the industry was able to operate where it was always located even if a coastal location could be advantageous.
The map to the left shows the extension of the steel industry in 1850 while the map to the right its extension today.
