Steel lump

Steel lump
Creation

Activate iron lump (1.00kg) Right-click Glowing hot charcoal (0.5kg) Open submenu "Create > Miscellaneous"
Result
0.40kg Steel lump
Skill and improvement
Uses metallurgy Cannot be improved
Properties
Can be combined when glowing hot.

Description

A heavy lump of dark steel.

A success will result in 0.4kg of steel per 1.0kg of iron and 0.5kg of coal.
Using larger pieces of iron and coal will result in larger pieces of steel. It will use as much material as possible in the 1.0kg iron to 0.5kg coal ratio. You may get less high QL pieces but the average QL will be similar to creating small steel pieces.
A failed attempt decreases both the charcoal and the iron lumps weight by .04kg.
The quality of the charcoal affects the success chance as well as the likelihood the lump will be high quality. It would be wise to not risk wasting high quality iron on poor charcoal unless you have a lot of it.
The quality of the iron lump caps the quality of the steel lump.
Only the charcoal needs to be glowing hot.
As of this patch, steel items now take reduced damage on use. Steel pickaxes take 20% less damage from use than similar quality iron pickaxes. Tested 7/11/2012 on Celebration server using QL 1 steel and iron pickaxes. The iron pickaxe took 0.15 damage every 5 seconds while the steel pickaxe took 0.12 damage. Thus 0.12/0.15 = .80 for a 20% damage reduction.