Day: 24 June 2020

The negative impact of the Covid-19 pandemic on shipments and operating income at Klöckner & Co in the second quarter was mitigated more than expected. This was supported by the advanced digitalisation of the company.

Compared with the previous forecast of a negative operating income, the distribution group now expects to break even, or post positive Ebitda of up to €10 million ($11m) before material special effects. On its advanced digitalisation, Klöckner cites the smooth shift of large parts of working activities to staff working from home. This enabled continuous delivery capability and proved to be a significant competitive advantage, it says.

At a press conference call in May, ceo Gisbert Rühl already said the hiatus caused by the coronavirus epidemic could turn out to be a classic case of a crisis that generates new opportunities.

Since the start of the lockdown, Klöckner made progress with transferring its business to online platforms. “Now that there is a crisis, we can implement some of the measures faster,” Kallanish heard from Rühl at the conference. The company’s share of online sales in March and April rose faster than it did in early 2019.

Almesa, the Spanish distributor of steel tubes, has announced the consolidation of all companies it controls into one larger group, to support its growth in the sector.

The Almesa group has now incorporated, for example, Apro and Tubonor, which are units it acquired since 2018. Following the consolidation, Almesa aims to become the largest Spanish group for tubes distribution and one of the top ten players globally. Overall sales should reach some €40 million ($45m) each year.

Almesa was formerly controlled by Tubos Reunidos, the steelmaker and tube producer located in northern Spain, Kallanish notes. The company was then sold by Tubos Reunidos to Almesa’s management in June 2017, thus maintaining a strategic partnership for the distribution of the group’s production across Spain.

Thyssenkrupp Materials Services, the trading unit of German steelmaker Thyssenkrupp, is tapping into the recycling and selling of steel scrap under a newly formed joint venture, Thyssenkrupp said June 23.

The joint venture “mt industry recycling” was founded June 2 together with Germany-based venture builder Mantro and will recycle and sell scrap sourced from product waste and metal processing companies.

The company aims to eliminate the scrap dealer in the supply chain and sell directly to steel mills and foundries.

“Already today, almost half of the steel production comes from recycled steel scrap. In Germany alone, this corresponds to over 20 million metric tons of scrap every year,” said Jan Crommelinck, managing director of mt industry recycling and Lead New Business Model at Thyssenkrupp Materials Services.

According to a joint press release, the jv would be able to offer lower costs and purchase prices due to a streamlined process while providing scrap that can be melted down and reprocessed “without any loss of quality.”

A Thyssenkrupp Materials spokesperson could not confirm how much volume the jv aims to turn over per year and said that the first stage of the company would be to “validate the business model.”

According to German scrap association BVSE, steel scrap usage for crude steel production stood at 17.7 million mt in Germany in 2019, down 4.8% year on year. The outlook for 2020 remains bearish in terms of demand as Germany’s economy and its key sectors such as the automotive and mechanical engineering industries were put on a temporary halt in spring due to the COVID-19 pandemic.

— Laura Varriale

A new series of strikes has hit production at the integrated site of Tata Steel Europe in IJmuiden, Kallanish learns from sources.

According to local unions in the Netherlands, strikes have continued for a second consecutive week, intermittently affecting a number of units at the mill. Last week, crude steel production was again affected by demonstrations. This week, new stoppages have been reported at the hot-dip galvanizing lines.

Strikes officially started on 10 June, the first time in 28 years that such an event occurred at the IJmuiden plant.

“Since Tata Steel Europe announced last year that it would reorganise on behalf of the Indian owners, the company has been unsettled,” says the FNV labour federation. “Employees of the profitable Tata Steel Netherlands fear that they will have to integrate with the loss-making Tata Steel UK. In addition, they want, among other things, that the management guarantees there will be no redundancies and that no jobs will be cut until at least 2026.”