Day: 29 November 2021

Turkish steel mills’ sections exports in the first three quarters of the year totaled 1.59 million mt, up 15.7% year on year, according to the latest monthly Turkish Statistical Institute (TUIK) data.

Morocco was the top destination for Turkish sections in January-September at 106,700 mt, up 17% on year, while exports to Malaysia reached 88,000 mt, up 31.3%.

Peru became one of other largest importers of Turkish sections in that period at 87,000 mt, more than threefold higher on year, while Turkish mills’ sections exports to Egypt totaled 77,300 mt, down from the 111,700 mt exported in the same period the previous year.

Turkish mills exported 67,300 mt of sections to Colombia in the nine-month period, while exports to the UK totaled 65,000 mt.

Other destinations were Israel (56,300 mt), Canada (42,000 mt), Italy (36,000 mt), UAE (36,000 mt), Greece (35,100 mt), Argentina (32,300 mt), Iraq (30,500 mt), and the US (29,600 mt).

— Cenk Can

The UK auto sector produced 64,726 vehicles in October, down 41.4% year on year to the weakest October since 1956 due to the ongoing semiconductor shortage leading to production stoppages, according to the latest data released by the Society of Motor Manufacturers and Traders Nov. 26.

The October volume brought total car production for the first 10 months of 2021 to 721,505 units, down 2.9% from 2020.

“The weak output totals compared to last year are exacerbated by the closure of a UK car plant at the end of July, a deficit that will impact figures for a year,” the SMMT said.

SMMT CEO Mike Hawes said the figures were “extremely worrying and show how badly the global semiconductor shortage is hitting UK car manufacturers and their suppliers.”

“Britain’s automotive sector is resilient but with COVID resurgent across some of our largest markets and global supply chains stretched and even breaking, the immediate challenges in keeping the industry operational are immense,” Hawes added.

He said that the UK government could help the sector with measures to boost competitiveness in line with global rivals, tackling high energy costs, supporting employment and training, and helping businesses with cashflow pressures.

On the positive side, 30.9% of the total output comprised battery, plug-in or hybrid electric vehicles, the SMMT said.

It noted that, with BEV manufacturing climbing 17.5% to 8,454 units, UK automakers had produced more than 50,000 zero emission vehicles in the first 10 months of 2021, bypassing the total manufactured during the whole of the pre-pandemic 2019.

October production for the domestic market fell 37.9% on the year to 11,608 units, while output for export markets decreased 42.1% to 53,121 vehicles.

Of the exports, 60% went to the European Union due to the Brexit deal allowing automotive trade with Europe to be tariff-free, the SMMT said and, although shipments to the EU fell 29.2%, exports to Japan and the US fell more by 57.1% and 67% respectively.

Over the 10-month period domestic output totaled 124,957 vehicles, down 10.4% year on year, while production for export dropped just 1.2% on the year to 596,548 units.

Commercial vehicle output up 17%

Meanwhile, 7,892 commercial vehicles were produced in the UK in October, up 17.2% year on year, although this was 6.9% below the five-year pre-COVID average, the SMMT data showed.

For the first 10 months of 2021 commercial vehicle output was up 15.6% on the year to 58,813 units, although this was 18% below the pre-pandemic average, due to the “pingdemic” staff shortages earlier in 2021 and the semiconductor shortage.

According to the SMMT, October production for the domestic market rose 29.8% on the year to 3,960 units, while output for export markets increased 6.8% to 3,932 vehicles.

Over the 10-month period domestic output totaled 28,525 vehicles, up 28.2% year on year, while production for export climbed 5.7% on the year to 30,161 units.

Throughout 2021, SMMT noted that the export share had decreased from 56.1% in 2020 to 51.3%, with output for UK buyers continuing to accelerate faster than those abroad.

Hawes said while October production had risen from 2020’s weak volumes, the sector was not immune from the ongoing challenges caused by the pandemic and the ongoing semiconductor shortage.

“There remains plenty of uncertainty in the months ahead. UK manufacturers are committed to doing all they can to keep production lines operational, getting more of the latest, cleanest CVs onto our roads, and boosting fleet renewal which will go a long way to improving air quality in urban areas,” Hawes added.

— Jacqueline Holman

Aperam’s proposed acquisition of German stainless steel and alloys recycling group ELG has been approved by the European Commission, the Luxembourg-based stainless steel producer said Nov. 26.

The completion of the acquisition is expected in the current quarter, the company said.

In May, Aperam announced it had agreed the acquisition of Duisburg-based ELG Haniel, which is active in recycling, processing and trading of stainless steel and nickel- and titanium-based superalloys scrap globally, delivering 1.3 million mt/year of material.

The acquisition “will put Aperam at the core of the circular economy and enable capturing value in the global recycling industry,” the company said at the time, adding that “investing in sustainable recycling will further improve Aperam’s leading environmental footprint and support the company’s CO2 reduction targets.”

The transaction will also enable Aperam to improve its input mix and to expand into the supply of raw materials, the company said.

Aperam has a production capacity of 2.5 million mt/year of flat stainless steel in Brazil and Europe.

— Andy Blamey

The European Steel Association (Eurofer) has filed a registration request against hot-dip galvanized steel coil imports from Turkey and Russia that could make retroactive any duties set in a dumping case opened by the European Commission (EC) five months ago.

The association said in a letter sent to the Commission, seen by S&P Global Platts, that it is concerned with the significant increase in dumped imports from Russia and Turkey since the initiation of the investigation on June 24.

Noting estimated average dumping margins of approximately 18% for Turkey and 33% for Russia in the investigation period, Eurofer said the average monthly imports after the initiation of the case on June 24 – from July to September 2021– also showed an increase of 24% in comparison to the average monthly imports during the investigation period.

“The imports are likely to continue increasing, and to undermine the remedial effect of any measures imposed in this case, unless the Commission disciplines imports via registration,” Eurofer said in the letter.

A Eurofer spokesperson declined to make further comment on the registration request letter when approached by Platts Nov. 26.

The EC opened an investigation into hot-dip galvanized coil imports from Turkey and Russia on June 24, alleging imports of certain corrosion-resistant steels originating from these countries were being dumped.

Pre-disclosure of the investigation is expected on Dec. 24, while provisional measures, if any, will be imposed by the EC until Jan. 24, 2022, informed industry sources told Platts. Definitive measures could be announced on July 20, 2022.

The EU’s dumping probe on Turkish HDG has already begun to raise some concerns among European buyers in recent months, while EU quotas continue to limit Turkish mills’ export volumes, as Platts has reported.

— Cenk Can

Germany and the Netherlands have gained rights to substantial steel export quotas to the US from Jan. 1, 2022, after the US ends its current regime of Section 232 import tariffs on steel from the EU under a bilateral deal, according to documents posted on the US Department of Commerce website. Sweden and Austria’s quotas are also viewed as apparently favorable in some products.

The EU’s largest steel producer Germany gained a lion’s share of the region’s total annual tariff-rate quotas, or TRQs, for export to the US, at 3.33 million mt. Germany will have the right to export a total 907,893 mt of a wide variety of products, a listing showed. Its quotas include 121,185 mt annually of tinplate, 86,221 mt of plate in cut lengths and 85,676 mt of line pipe exceeding 406.4 mm in outside diameter.

Italy, the EU’s second biggest steel producer, with total quotas of 360,477 mt was left substantially behind Germany, and overtaken by the Netherlands’ total quotas of 507,598 mt. The Netherlands is home to Tata Steel’s major IJmuiden steel mill — a traditional exporter of hot rolled coil to the US.

The Netherlands’ annual quota for sales of hot rolled sheet to the US has been set at 122,529 mt, with hot rolled plate in coils at 72,575 mt, and tinplate at 195,794 mt.

The TRQ system will replace the existing 25% tariff that former US president Donald Trump imposed on EU steel imports under Section 232 legislation in March 2018. The aggregate annual import volume under the TRQ is set at 3.3 million mt under 54 product categories and allocated on an EU member state basis, in line with the 2015-2017 historical period, the US Department of Commerce said.

“The split up is a simple calculation which brings the TRQ closer to the traditional EU export flows to the US (per Member State),” said a spokeswoman for European Steel Association Eurofer.

Section 232 tariffs, however, continue to be imposed by the US on steel imports from other countries and regions, although bilateral talks on an alternative trading arrangement are currently underway between the US and Japan.

AD duties continue

According to one German plate market source however: “The tonnages are not a lot for Germany. Salzgitter still has a hefty antidumping duty, Dillinger might benefit from that. Industeel as well though the quota for Belgium is not a lot. Same for NLMK in Denmark.”

The plate source was referring to the cut to length or processed plate duties on some European platemakers: the US slapped AD duties on various producers in 2017.

Austria’s annual TRQ for hot-dipped flat rolled products is of 22,903 mt and for oil country pipe and tube goods 85,114 mt. Earlier this month, the country’s US quota levels were described by Herbert Eibensteiner, CEO of steelmaker Voestalpine, as “a good fit for Austria”. Eibensteiner said Voestalpine had continued exports to the US despite a “high administrative burden” to get exemptions for its shipments and an annual duty bill on pipe exports to the US oil and gas sector of Eur40 million ($45.23 million).

Among some of the larger country quotas are: Sweden’s quotas of 76,750 mt for cold rolled sheet and other products, of 32,320 mt of hot rolled plate in coils and 20,293 mt for hot rolled sheet. Belgium’s quotas include 24,463 mt for cold rolled sheet and other products, 26,610 mt hot rolled sheet, 13,108 mt for plate in cut lengths and 11,680 mt flat rolled stainless steel products.

The Czech Republic’s TRQ will allow annual exports of 28,741 mt of standard rails, 16,043 mt hot rolled bars, 14,317 mt of line pipe not exceeding 406.4 mm in outside diameter. For plate in cut lengths, France gains a TRQ of 73,869 mt, Denmark gains a TRQ of 11,024 mt and Finland of 18,220 mt. France also gains a 50,278 mt of hot-rolled bars.

Greece gains a 68,531 mt TRQ for line pipe exceeding 406.4 mm in outside diameter. Luxembourg gains an 86,395 mt quota to send angles, shapes and sections to the US, as well as a 38,016 mt quota for sheet piling.

Turkey rebar trade

One trading source did not expect the total annual quota of 67,248 mt for EU-origin rebar imports into US to have a significant effect on the Turkish rebar exports market.

“One of the players undercutting Turkish rebars to USA is Tosyali Algeria,” he said, adding that while Tosyali rebars do bear a 25% tariff on exports to the US, they don’t also have anti-dumping and countervailing duties, so buyers in the US are already booking rebars ex-Algeria.

“It was long known that the quota for Europe in US will be around 90,000 mt so no impact,” he added.

Quarterly administration

Commerce clarified on its website that the TRQ will be calculated for each year of the measure and administered on a quarterly basis. Any unused TRQ volume from the first quarter of the year, up to 4% of the allocated quota for that quarter, will roll over to the third quarter. Any unused TRQ volume from the second quarter of the year, subject to the same limit, will roll over into the fourth quarter, and any unused TRQ volume from Q3, subject to the same limit, will roll over into Q1 of the following year.

“The TRQ will be allocated on a first-come, first-served basis for each product category from each EU member state. The US will provide on a public website updated information on the utilization of the quarterly quota for each product category, including information on the transferred unused TRQ volumes from one quarter to another,” it said.

— Diana Kinch, Laura Varriale and Rabia Arif

Energy sector electrical components supplier FEAG will save more than 2,000 tonnes of CO2-equivalent emissions by purchasing 1,000 tonnes of steel with “XCarb” green steel certificates, says ArcelorMittal.

The certificates will enable the FEAG Group to significantly reduce its own Scope 3 emissions and those of its customers.

An example of the XCarb initiative is the capture of hydrogen-rich waste gases from the steelmaking process. These gases are injected into the blast furnace to reduce the use of coal, Kallanish notes.

FEAG utilises a range of cold rolled steel from ArcelorMittal, including electro-galvanised and hot-dip galvanised material. The firm recently started procuring ArcelorMittal’s “Jetskin” coil which is coated with zinc using Jet Vapor Deposition (JVD) technology. “We plan to increase our use of more sustainable materials such as Jetskin,” says FEAG Sankt Ingbert unit chief executive Dr Karsten Wünsche. “This will enable us to move away from electro-galvanised and hot dip galvanised steels.”

FEAG is the first customer that ArcelorMittal Downstream Solutions – Steel Service Center Edenkoben has provided with XCarb green steel certificates. The steel will be delivered throughout 2022.

Adam Smith Germany

Production stoppages at carmakers’ assembly lines are currently causing massive fluctuations in call-off orders at sheet-forming German automotive suppliers. Their association, IBU, which represents around 240 predominantly medium-sized companies nationwide, has issued an urgent statement addressing the problem, following a survey among its members.

“OEMs are cancelling call-offs at short notice, not caring about problems for the supplier,” Kallanish hears from Bernhard Jacobs, managing director of the association. In terms of reliability, most members gave their customers a poor “E” rating, while more than 20% even opted for an “F” in the survey.

Production at almost 90% of participants in the poll is currently affected. Some 50% of participants in the IBU flash survey are so-called Tier 2 suppliers. Just under 20% fall into the Tier 1 category, and a similar number are Tier 3 parts suppliers.

About 70% of participants complain that manufacturers are not willing to share additional costs caused by production stops, with the exception of a few. The consequences are short-time work and wage losses for the employees of supplier companies.

Especially annoying for suppliers is that they have often accepted high purchasing prices for sheet and coil in order to remain able to supply their customers. “Although it must be clear to every customer that it is inevitable that rising costs must ultimately be passed through the supply chain,” Jacobs says.

Christian Koehl Germany

Italian pig iron prices remain flat, with some producers not quoting due to persistent shortages. Demand from distributors who buy directly from CIS producers is lively and, this week, pig iron makers are expected to go back to quoting at least $590-600/tonne cfr Italy, Kallanish learns from market participants.

Stocks at the Port of Marghera, the main steel hub in Italy, are average. Last week, mills continued to purchase 1,000-2,000 tonnes from Marghera at the equivalent of $585-600/t cfr. In November, distributors have bought large tonnages of pig iron at $580-585/t cfr Italy. The country will be receiving between 60,000t and 80,000t of pig iron purchased in November, sources believe.

No Brazilian material has been sold in Italy so far this month. Brazilian offers are hovering at $570-580/t cfr but only for larger, 30,000t vessels.

Meanwhile, Italian billet prices remain at €600-620/t ($677-688) ex-works and no billet exports were heard last week.

Natalia Capra France