Day: 9 June 2021

Distribution group Klöckner & Co expects a significantly stronger-than-forecast second-quarter profit, on the basis of further considerable steel price increases, Kallanish learns from an ad-hoc release.

Against this background, the company says it now expects an operating profit – Ebitda – before material special effects of €260-290 million ($317-353m), contrary to the previous expectation of €130-160m.

The announcement echoes a similar ad-hoc release from February, which announced a bigger-than-forecast Q1 profit even earlier during the still ongoing quarter.

Germany-based Klöckner & Co is the largest steel distribution group with activities on both sides of the Atlantic, in Europe and in the USA. It notes that price increases on both markets are contributing to the profitable performance.

Christian Koehl Germany

ArcelorMittal has made the first $10 million investment from its first XCarb carbon neutrality fund investment in solar company Heliogen, the steelmaker said June 8.

On top of the initial investment, AM and Heliogen have also signed a memorandum of understanding to evaluate the potential of Heliogen’s products for several of AM’s steel plants, it said in a statement.

“Developing and deploying breakthrough technologies is at the heart of our climate action strategy,” Pinakin Chaubal, AM’s chief technology officer, said in the statement. “While our own efforts are progressing well, the objective of our XCarb Innovation fund is to extend our reach and support companies developing technologies which could assist us on our decarbonization journey. The technology Heliogen is developing has the potential to do exactly that.”

ArcelorMittal set up the XCarb fund in March, with the aim of investing up to $100 million annually in companies developing technologies to speed the steel industry’s transition towards carbon-neutral production. The technology also needs to be commercially scalable, AM said.

Heliogen’s solar technology is to be converted into heat (HelioHeat), electricity (HelioPower) or clean fuels (HelioFuel), AM said. All three Heliogen products have the potential to be used in the steelmaking process and sustain the industry’s transition to carbon neutrality, it said.

Hydrogen is an important element towards carbon neutrality as it can be used instead of natural gas as the reductant in the production of direct-reduced iron.

— Annalisa Villa

Output of passenger cars from German assembly lines in the first five months of the year reached 1.49 million units, Kallanish hears from national carmakers federation VDA.  

This is 25% above the production volume of the corresponding prior-year period, which was extremely affected by the lockdown of the first Covid-19 wave, with full standstills at carmakers. This shows, especially in the figure for May, which at 250,100 units is 58% up on May 2020.

Still, VDA notes that current production is still a big way away from pre-pandemic performance levels. It cites the prevailing shortage of semiconductors as the main obstacle to a higher utilisation of production capacities. VDA’s statement should make the steel industry watch out, because it could mean that carmakers’ demand could still be higher than it is, and thereby aggravate the current steel shortage.

Domestic order volume in January-May went up 17%, while orders from abroad rose by 37%. The most remarkable year-on-year increase was also for exports, which rose 75% to 177,700 units.

Christian Koehl Germany

ArcelorMittal is fast-tracking its takeover of Liberty Steel’s French facilities, Ascoval and Hayange, by submitting an official request to the European Commission for acquisition approval.

The company is among other bidders to have shown interest in the French mills (see Kallanish passim). An EU document states: “ArcelorMittal … plans to acquire the majority of the shares in or the assets of Liberty Steel France … Liberty Steel France includes two main assets: France Rail Industries (‘Liberty Rail’) and a steel mill (‘Liberty Ascoval’).”

Meanwhile, ArcelorMittal confirms to Kallanish that it plans to invest in and grow the assets “in the short- to medium-term, improve the sustainability and profitability of both operations and integrate them into ArcelorMittal’s European network”. It adds: “The Hayange and Ascoval plants would benefit from ArcelorMittal’s significant R&D capabilities in products and processes, particularly in the rail business, market knowledge and sales footprint, investment and business development capacity, logistics and storage capabilities.”

ArcelorMittal would also commit to maintaining employment at existing levels, the firm adds. The acquisition would further enhance ArcelorMittal’s industrial footprint in France and complement its existing rail assets.

ArcelorMittal produced approximately 8 million tonnes of steel in France last year and employs 15,500 people.

Liberty Ascoval is a steel manufacturer, which produces continuous cast rounds and forged products at a production facility in Saint-Saulve, France. Recently, Liberty Ascoval started the production of blooms and square billets for a variety of applications, including rail blooms, which are supplied solely to Liberty Rail. Liberty Rail produces rails at its production facility in Hayange.

Natalia Capra France