Day: 20 December 2021

Flat steel shipments from steel service centers in the 27 nations of the European Union, plus the UK, rose 11.5% on year in the January through October period, stockholder and distributors’ association EUROMETAL said in its November bulletin.

Long products shipments by distributors meanwhile rose 6.6% on the year in the same period, the association said.

Flat products

In October, strip mill products shipments fell 12% on the year, compared with a drop of 5.5% in the month of September, EUROMETAL said.

When expressed in days of shipments, stocks at steel service centers in the EU reached 63 days in October from 57 days in October 2020, it said.

The index of stock volumes stood at 87 in October, compared with 79 in October 2020 (average 2018 = index 100).

Long products

In the 10 months of 2021, total long and other products shipments from service centers in the region grew 6.6% on the year, with only rebars registering lower shipments than the year-ago period.

In the month of October, however, long and other products shipments fell 11.8% overall from the same month of 2020, the association said. All products had a negative trend, except plates, tubular products, stainless steel, and other alloy steels.

Stock volumes of long and other products stood at 79 days of shipments in October, compared with 66 days in October 2020.

The stock volumes index of long and other products was registered at 86 in October, higher than the index of 81 one year previously (average 2018 =Index 100).

— Diana Kinch

The European Commission Dec. 17 has formally initiated a periodic review into its steel import safeguard measures, which will also assess how changes to be introduced Jan. 1 to the US Section 232 import tariffs may affect steel trade flows, the EC said in a document published in the Official Journal of the European Union.

According to Yuriy Rudyuk, the Brussels-based partner at law firm Van Bael & Bellis, the EC review has been brought forward from the initially expected February or March 2022.

The EC said in its Dec.17 document that respondents will have until Jan. 10, 2022, to submit opinions both on the existing safeguard measures and the Section 232 changes.

The review will cover 26 product categories, including hot-rolled sheets and strips, cold rolled sheets, metallic coated sheets, tin mill products, stainless hot and cold rolled sheets and strips, merchant bars, light and hollow sections, rebars, wire rod, railway material, and seamless and welded tubes.

The EC will analyze the evolution and patterns of the use of tariff-rate quotas to determine whether any adjustment resulting from changed circumstances may be warranted in the Union interest, for instance, due to the occurrence of so-called “crowding out” of access to residual TRQs in the last quarter of a period.

The EC had originally committed to concluding a functioning review investigation of the safeguard measure by June 30, 2022. The bringing forward is understood to be related to the changes to the US’ Section 232 tariffs.

The EC imposed definitive safeguard measures on imports of certain steel products Jan. 31, 2019, to help curb trade deviation arising as a result of the US’s imposition in March 2018 of Section 232 25% import tariffs on steel products from many nations. The EC safeguard measures were prolonged from July 2021.

The Section 232 tariffs will meanwhile be removed on imports from the EU by the US Jan. 1, 2022, as part of a new bilateral deal between the two parties, which will also involve the EU’s suspension of additional duties imposed on its imports of certain US goods.

The EU safeguards review now to take place will seek to update the list of developing World Trade Organization member countries excluded from the scope of the measures based on their most recent level of imports. According to an EU regulation from 2015, no safeguard measure may be applied to a product originating in a developing country member of the WTO as long as that country’s share of Union imports of the product concerned does not exceed 3%.

The commission will also assess, based on the evidence submitted by interested parties, whether any increase to the level of liberalization currently applicable in the safeguards measures, e.g. 3 % annually, is justified, it said.

— Diana Kinch

The European Commission will announce the results of its ongoing probe into dumping of hot-dip galvanized steel late January, Turkish industry sources told S&P Global Platts, adding there will be meetings between the EC and Turkish coated coil producers in the first weeks of the new year.

Turkish mills have submitted the required files to the EC, a manager of a Turkish coated coil producer told S&P Global Platts, adding that a meeting with the EC was set for mid-January. “We do not expect the EC will officially announce the result of the investigation before the end of January,” the manager said.

Another coated coil producer manager also confirmed a meeting with the EC, in the second week of January, saying the commission will also hold meetings with other coated coil producers.

The EC opened an investigation into dumping of HDG from Turkey and Russia on June 24 to determine whether the products under investigation were being dumped in 2020 and if those imports caused injury to EU producers.

In addition, the EC said the examination of trends relevant for the assessment of injury will cover the period from Jan. 1, 2017, to the end of the investigation period.

Provisional measures in the investigation, if any, will be imposed by the EC late January, while definitive measures are scheduled to be announced on July 20, according to a document seen by Platts.

Although demand from the EU, particularly from southern European member states, supported Turkish mills’ coated coil exports in the first 10 months of 2021,the investigation has begun to raise some concerns among buyers in recent weeks, sources said.

According to Turkish Statistical Institute (TUIK) data, Turkish mills exported 1.94 million mt of coated coil, mostly HDG coil, to global markets in widths of 600 mm and above over January-October, some 570,000 mt higher year on year, while EU countries remained Turkey’s top coated coil export destinations by far.

Spain was Turkey’s main coated coil buyer over January-October, importing 507,400 mt, 86% higher year on year, while Belgium imported 200,700 mt from Turkey, up 11%.

— Cenk Can

New passenger car registrations in the EU in November were down 20.5% year on year to 713,346 units, the lowest total for the month since 1993 and the fifth consecutive month to see a year-on-year decline, the European Automobile Manufacturers Association (ACEA) said Dec. 17.

The volume was, however, 7.3% higher than in October and was at the highest level since July, the ACEA data showed.

Germany, the EU’s largest car market saw registrations fall 31.7% year on year to 198,258 units in November, which was 11% higher than October.

France, the second-largest market, saw sales fall 3.2% year on year to 121,994 units, which was up 2.9% from October.

Car sales in Italy dropped 24.6% year on year to 104,478 units, but climbed 3.4% month on month. The trend was the same in Spain, where 66,399 units were sold in November, down 12.3% year on year, but up 12.5% from October.

According to the data, only Bulgaria (plus 24%), Ireland (+22.9%) and Slovenia (+15.8%) showed higher year-on-year volumes of 24,134 units, 1,122 units and 4,126 units, respectively.

Over the first 11 months of 2021, new car registrations in the EU were 0.04% lower at 8.9 million units.

The ongoing semiconductor microchip shortage had dragged year-to-date sales performance into negative territory, despite 2020’s record low base for comparison, ACEA said.

Despite that, vehicle demand remained positive in three out of the four key EU markets over the 11-month period, namely Italy, which was up 8.6% to 1.4 million units, Spain up 3.8% to 773,396 units and France up 2.5% to 1.5 million units, although largest market Germany’s year-to-date dropped 8.1% year on year to 2.4 million units, the ACEA data showed.

— Jacqueline Holman

South Korea’s Posco plans to focus on expanding and “greening” its steel business after it is spun off into a separate unlisted entity on March 1, 2022 that will be 100% owned by a new holding company, the steelmaker said in a recent presentation to investors.

The move will facilitate the steelmaker’s plan to raise its crude steel production capacity by almost 48% to 68 million mt/year in 2030 from 46 million mt/year in 2021 while furthering its “green” goals that would lower its annual carbon dioxide emissions to 71 million mt from 79 million mt over the same nine-year period, the company said.

Posco has recently given priority to new business such as hydrogen and batteries under “a steel-centered management system,” the company said in a statement Dec. 10 when its board approved the spin-off plan.

“From now on, the steel subsidiary will put aside its role as the group’s management and focus on their own innovative task of eco-friendly steel manufacturing,” Posco said in the statement. Shareholders are expected to vote electronically on the plan by Jan. 28, 2022.

As part of the expansion, two new electric arc furnaces will be built in 2025 and 2027, respectively, while research and development of hydrogen-based ironmaking is expected to result in the construction of a demonstration plant by 2028 that is projected to have a capacity of 1 million mt/year, requiring 100,000 mt/year of hydrogen.

Posco also aims to more than quadruple its overseas crude steel production capacity in nine years to 23.1 million mt/year from 5.1 million mt/year in 2021.

To support its expansion, the steelmaker will set up a base to increase its scrap purchases and take stakes in such overseas scrap suppliers, targeting about 4 million mt/year of scrap.

Overseas ventures

It will also invest in overseas hot briquetted iron plants, which includes investing in a HBI joint venture with Australian miners with about 2 million mt/year of HBI. Posco is working with iron ore supplier Roy Hill to research hydrogen production and develop hydrogen-based steelmaking processes. It also has a similar arrangement with Rio Tinto.

Posco’s aim to use green hydrogen to replace coal, estimating a need for 3.7 million mt/year of the gas. It plans also to become a major producer and supplier of hydrogen, making 5 million mt of green hydrogen by 2050.

Without disclosing details, Posco said it aims to build an integrated steel mill in India using eco-friendly infrastructure such as renewable energy and hydrogen, likely through its local subsidiary Posco Maharashtra Steel, which has 1.8 million mt/year of cold-rolled steel sheet production and 450,000 mt/year of hot-dip galvanized steel capacity.

It will eventually increase its production in Indonesia to about 10 million mt/year via Krakatau Posco, a 70:30 joint venture with Posco the majority stakeholder. The Indonesia JV operates an integrated steel mill at Cilegon in Banten province with a production capacity of 3 million mt/year. The JV plans to increase production to 6 million mt/year under a phase two project.

Posco has also formed a 50:50 JV with China’s HBIS Group to build a 900,000 mt/year plant at Tangshan in Hebei province. Construction will begin in January 2022 and completion is scheduled by the end of 2023.

In the US, Posco plans to form a partnership for an integrated electric arc furnace, aiming for partners with a lead in low-carbon materials and the US steel market. It also has plans to build an EAF with 1.5 million mt/year of crude steel production capacity in neighboring Mexico through a joint venture via its Posco Mexico subsidiary.

— Clement Choo

The Odisha state government has approved ArcelorMittal Nippon Steel (AMNS) India’s INR 1.02 lakh crore ($13 billion) investment into a 24 million tonnes/year capacity integrated steel plant in Kendrapara.

The plant, which will also produce up to 18.75m t/y of cement, will be completed in seven years in phases, and employ 16,000 workers. AMNS India will also develop a downstream industry park to promote micro, small and medium enterprises, and support import substitution, the office of Odisha chief minister Naveen Patnaik says in a note seen by Kallanish.

AMNS India also aims to increase production capacity at its existing Hariza plant to 15m t/y, from the existing 8.6mt. In comments to media last week, ArcelorMittal chief executive Aditya Mittal emphasised cost competitiveness efforts during the capacity expansions. “We must consistently strive for stable and cost-effective steelmaking operations,” he said. “Real progress has already been made here, with the commencement of mining operations in Odisha. Also, with the commissioning of a second pellet plant at Paradeep, and strong progress is being made with the debottlenecking project at Hazira.”

The executive stressed building a portfolio of value-added products for stronger financial returns and aims for AMNS India to be a leader in sustainable development.

“The significant, unforeseen disruptions of the past 20 months have not dented that ambition, nor materially hindered our progress. Our business is very strong, our focus on health and safety remains our priority,” the executive concluded.

Sayed Aameer India , Adam Smith Germany

Turkey’s Colakoglu Metalurji is installing new Smart Steel Technologies’ SST Temperature AI software in order to achieve precision temperature control in melts, the company says.

The installation of the technology, which will be implemented live without interruption to the melting process, will enable savings on energy costs and reduction in CO2 emissions, while leading to increased stability of electric arc furnace operations, Kallanish notes.

As a result, the steelmaker will be able to minimise temperature fluctuations while lowering overall temperature of melts. Further cost savings will come through this process stabilisation, when the software is installed at the beginning of 2022.

“Thanks to the use of SST software, Colakoglu will be able to achieve maximum cost savings and take an indispensable step towards a digitalised, CO2-neutral future in steel production,” says Colakoglu chief executive Ugur Dalbeler.

Katya Ourakova UK

Transports of coil in western Germany are more-so-than-usual exposed to high prices, shortage of truck capacities, and blocked roads.

For one thing, this concerns delivery of imported material from Antwerp, by ship as well as by truck. A Ruhr-based buyer says he nowadays pays €20,000 ($22,660) for a typical inland ship load that not so long ago cost only €6,000. Road trucks are not the alternative they used to be, due to the shortage of drivers and capacities being seen in most European countries at present, he tells Kallanish.

Another issue, especially for border-crossing traffic, is the limitation to a maximum coil load of 24 tonnes. “Now, our coils normally weigh 26 tonnes,” he says. “For that, you need an extra permit, and not enough haulage companies in the Benelux have it.”

Another issue arose three weeks ago in southeastern North Rhine Westphalia when a bridge on the so-called “Sauerland” A45 motorway was blocked due to damage. “I have many customers in the Sauerland, but when I ask for four trucks now, the transport company will give me two and hold two back,” he says.

“A coil transport by truck from the Ruhr to the Sauerland costs about €100, and haulers have little interest in having their trucks spending time in endless traffic jams,” he said on Friday. “Only this morning I myself spent four hours on the way for a customer talk of 45 minutes.”

Christian Koehl Germany

Spanish long products supplier Celsa Group says it has received €2.5 million ($2.83m) from the National Ministry of Industry, Trade and Tourism’s €54m fund for innovation and sustainability projects in the manufacturing industry.

The steelmaker will use the aid to accelerate its programme to promote the circular economy and reduce CO2 emissions, Kallanish learns from Celsa.

“The Group is reorganising its operational structure to promote strategic objectives by creating two new positions – chief circular officer (cco) and chief strategy & sustainability officer (csso),” Celsa explains. These will be held by Xavier Cabré and Juan Carlos Orozco Rodríguez respectively. The steelmaker’s main target remains to be “net positive” by 2040.

Celsa is still awaiting approval to access the Spanish government Covid-19 crisis rescue fund (Sepi), to help maintain its solvency. The estimated amount requested is almost €700m, according to media reports.

Todor Kirkov Bulgaria

Germany’s construction industry expects an increase in activity and revenue by 5.5% next year versus 2021, Kallanish learned at last week’s joint annual conference of the industry’s main associations, HDB and ZDB.

In 2020, the first year earmarked by the coronavirus, the industry actually saw an increase in revenue from the €135 billion ($153 billion) achieved in 2019, to €143 billion. The latter is also the value forecast for 2021. While activity has remained sturdy despite the pandemic, many projects did not commence as planned, and will now likely be started in 2022.

One reason for this are bottlenecks in materials supply, and/or high prices, which typically delay projects. Steel was arguably the construction material that saw the largest price increase, which the federations put at 70% within one year.

To a certain extent, construction companies are now succeeding in passing this pressure on to the purchasing side of the market, the associations observed. As of September, prices for construction had risen by almost 6% compared to the previous year. This means that revenue in real terms – at a nominally flat value of €143 billion – suffered a decline of 6%.

The associations pointed out that their members will continue to enjoy high capacity utilisation, which has increased the willingness of companies to invest more heavily in new equipment than in other industrial sectors.

The respective presidents also emphasised that the high level of orders is mainly attributable to activity in residential construction, a consumer of mainly rebar. Commercial construction, with a larger share of sections, has been volatile. Until September, the willingness of industries to invest in new warehouses and production plants remained below the level of the previous year, they concluded.

Christian Koehl Germany