Day: 8 June 2023

For long-term contracts for the upcoming second half of 2023, European coil producers are heard seeking big premiums, in comparison to both half a year ago and to current spot prices.

Several buyers tell Kallanish that mills are striving for €100/tonne ($107) on top of the contracts signed around the turn of the year. From December on, spot prices had been gaining momentum, reaching around €700/t for hot rolled coil at the end of last year. The higher level of contracts started at €800/t, maybe at slightly less for those who signed very early, and more for those who came later.

“Right, half a year ago, contracted prices were slightly above €800/t, and now they [mills] are asking for something nearing €900/t,” a manager at a processor company says. He calls the offer “irrationally bold”, noting that “we [mills and buyers] are worlds apart”. In his opinion, prices should actually be lower than those from December, “which would still be above the current spot prices”. These are currently softening towards the mark of €700/t.

The wording of another buyer is similarly sharp. “They [mills] have totally lost their sense of reality. At the moment, people would not even accept a €50 reduction if it was offered,” he says. He expresses some understanding for the mills’ sales staff, who need to spur optimism, and aim high in order to possibly end up with a much lower compromise.

Apparently, not many negotiations have led to signatures yet. “Neither side has an idea where the price should be,” the buyer notes. “We are still lacking some pilot agreements to lead the way. Everyone is remaining wary, watching the other one’s moves.”

Christian Koehl Germany

French rebar activity continues to be slow, with orders being carried out only back-to-back and visibility low. May was a poor month for order intake, although the distribution sector reported good shipment levels. Rebar demand from other European markets such as Germany was also subdued last month and continues to be weak.

Activity in the construction sector in France but also in Germany is stalling and hampered by low demand for private residential buildings. Buyers’ stocks continue to be reported at relatively low levels. All local long steelmakers are expected to continue to implement production cuts in June, as they did in May, to address overcapacity.

Domestic rebar prices are declining again, from the levels of €650-680/tonne ($695-727) delivered to €590-630/t delivered, depending on volume and customer, Kallanish notes.

Natalia Capra France

US trade representative Katherine Tai is requesting that the International Trade Commission conduct a survey analysing greenhouse gas emissions data gathered from the nation’s domestic steel industry. This request follows the establishment of the United States-European Union steel trade agreement in October 2021, and intends to help inform both parties about the US steel industry’s emissions intensity rates.

Tai says the emissions intensity report should be based on average emissions rates during 2022. She requests that the commission complete its analysis by the end of January 2025.

Kallanish understands that the results of the emissions intensity report will be assessed in a breakdown by category between stainless steel and carbon or other alloy steel products. Furthermore, there will be an additional breakout for data as it pertains to separate sub-categories of carbon-alloy steel; flat, pipe/tube, long and semi-finished.

The US trade ambassador requests that the report analyses Scope 1, 2, and 3 emissions intensity rates for domestic steel production.

Zach Johnson USA

ArcelorMittal North America’s Dofasco facility in Hamilton, Ontario, will supply General Motors with its XCarb recycled and renewably produced (RRP) steel, which boasts reduced CO2 emissions compared to many other carbon steel products, Kallanish understands.

The company produces XCarb in its electric arc furnace (EAF) with 70-90% scrap and does not use carbon offsets. According to the ArcelorMIttal, the CO2 impact has been verified by an independent party for Life Cycle Analysis (LCA) and Scope 1-3 emissions. Additionally, the company shares that its steelmaking process uses renewable electricity sources.

“As a global leader in the steel industry, we are making smarter steels for people and planet, and XCarb RRP is one of the smartest steels around. It is steel with physically lower CO2 emissions, which will help drive the achievement of ArcelorMittal’s goal to be carbon neutral. We are proud to join GM in their march toward a zero emissions future,” said North American cmo of ArcelorMittal, Peter Leblanc.

The Dofasco plant is moving to direct-reduced iron (DRI) EAF steelmaking from blast furnace steelmaking. The transition is said to reduce carbon emissions by 60%.

Kristen DiLandro USA