ISD Dunaferr postpones lay-offs, continues efficiency improvements
ISD Dunaferr has postponed plans to lay off 350 workers after reaching a wage agreement with unions, a company official tells Kallanish.
The Hungarian steelmaker announced the lay-offs last October as a result of the weak performance of the European steel industry. Due to slowing economic growth and falling steel demand, the firm had to postpone a number of strategic development projects in 2019 and curtail production. However, it avoided the plant closures seen at other European steelmakers.
This week’s agreement will ensure there are no lay-offs until at least 31 December 2020. The parties agreed a 5.8% average wage increase versus the almost 34% raise seen in the last two years. But it comes at the cost of reducing the number of workers hired in the past two months, as well as early retirement for some employees and agency worker cuts.
“Pinpoint optimisation will obviously continue,” the official says of plans to boost efficiency. A spokesman adds that Dunaferr “… is now working hard to boost production and take advantage of improving market opportunities.”
Dunaferr recently revamped its hot-dip galvanized coil line, thereby increasing its capacity by 20-30% (see Kallanish passim). Last year the producer said it will increase HDG output to 130,000 tonnes/year.
In 2018 its hot rolled coil sales rose 1% on-year to 639,925t, with cold rolled coil and HDG sales up 3% and 4% respectively to 319,210t and 104,330t. Overall steel sales rose 5% to 1.64 million tonnes. The firm has a 1.7m t/y crude steel capacity.
thyssenkrupp sets closure deadline for plate mill
thyssenkrupp has confirmed that it plans to close its plate mill in the Hüttenheim district of Duisburg if no buyer is found by 30 June.
“We need to face the facts. The plant cannot go on as it does now. The option of specifying a sale or a continuation until 30 June creates the clarity we need,“ thyssenkrupp AG executive Oliver Burkhardt says in a statement sent to Kallanish. The alternatives have been specified earlier, but as time has passed it became increasingly unlikely that a buyer would emerge, given the overcapacity on the European plate market.
The deadline was announced to workers on Thursday evening and cannot have come as a surprise. Burkhardt expressed sympathy for discontent amongst the workforce, and pledged that the 800 workers at the mill will be offered jobs elsewhere within tk Steel. Nevertheless, union IG Metall has announced industrial action as a protest against the measure.
European Commission launches second review of steel safeguards
The European Commission (EC) has decided to initiate a second review of the imposed definitive safeguard measures on a range of products imported into the European Union (EU). This was signalled on 14 February 2020 in the Official Journal of the European Union, monitored by Kallanish.
The first review was concluded on 26 September 2019 following the imposition of the measures on 31 January 2019. The scope of the second review will mirror the framework of first one, the EC says. It will cover 27 separate categories of steel (see table).
There are five areas to be investigated by the review. The level and allocation of tariff-rate quota for a number of specific product categories and the crowding-out of international trade flows will comprise the first two areas. The potential detrimental effects in achieving the integration objectives pursued with preferential trading partners is the third one. There will also be an update of the list of developing WTO member countries excluded from the scope of the measures based on their most recent level of imports. And finally, other changes of circumstances that may require an adjustment to the level of allocation of the tariff-rate quota, will also be investigated.
The EC is inviting both submissions either in support of or in opposition to the measures within 15 days of 14 February 2020 and is also inviting comments on the submissions made. It intends to conclude the review by 30 June 2020.
European Commission launches review of steel safeguard measures
The European Commission said Friday it has launched a second review of the current safeguard measures on steel imports into the EU.
The EC will look at the overall framework and also review the list of developing World Trade Organization countries currently excluded from the measures based on their historically low volumes. The EC will assess whether imports from a developing WTO member exceed the 3% of its share of overall imports of the product subject to measures, given that developing countries collectively account for not more than 9% of product imports.
The EC is asking for interested parties to submit comments. The review will be concluded no later than June 30.
The European steel association Eurofer welcomed the review in a statement.
“We believe that further refinements could improve upon the existing system and make it more robust and responsive to actual state of the EU steel market,” Eurofer said.
“There are a number of ways in which the mechanism could be updated, and Eurofer hopes that the Commission will consider all the tools at its disposal to arrive at a balanced result that ensures traditional trade flows and rates are respected and EU producers see the market stability they need to make steel sustainably in the EU,” the association added.
The safeguard measures have been in place since January 31, 2019 and underwent a first review in the summer of last year following which the EC introduced a 3% annual increase in tariff-free steel quotas across all product categories, a cut from the original 5% annual increase.
The Commission also announced a free trade agreement with Vietnam earlier this week, but this is not expected to have an impact on the EU steel industry as the existing safeguard quotas will not be affected by the agreement and remain in place for imports of steel from Vietnam.
— Laura Varriale