Steel Service Centers concerned about the impact of CBAM
Last Thursday, EUROMETAL’s “SSC Arbeitskreis” (Steel Service Center Working Group) brought together industry leaders from Germany, Austria, Netherlands, and Belgium. The somber mood reflected concerns over the impact of the Carbon Border Adjustment Mechanism (CBAM) on the future of European steel processing.
Over two dozen steel executives grappled with the current economic climate – both German and global – alongside pressing issues like decarbonization, energy efficiency, workforce security, and distribution challenges. However, decarbonization, particularly CBAM, dominated the discussions.
Customers Seek Workarounds, Threatening Service Centers
Suppliers from Asia are looking for workaround solutions and are threatening European metalforming industry and service centres and ultimately also the European steel mills.
Participants at the conference reported on the fears of the forming and steel processing industry (laser and welded components) regarding the future of European steel supply chains.
Scared by the impact of CBAM, some large customers (1st tiers) are looking for external alternatives outside European borders and opting to import ready-to-use steel products, in order to circumvent the regulation.
This trend deeply worries Service Centers, especially considering the current period of moderate activity. Already facing significant investments in decarbonization and cost optimization, CBAM throws another wrench into an already challenging situation.
The Need for Collaboration
Despite the gloomy outlook, the working group highlighted the importance of ongoing dialogue and collaboration within the industry. The active participation throughout the event underscored the need for such forums to navigate the current complexities and develop solutions.
The future of European steel processing hinges on the industry’s ability to adapt to the demands of CBAM while remaining competitive. Collaboration and innovation will likely be key to weathering this storm.
Looking Ahead
The positive spirit of collaboration continued beyond the discussions. The intention to repeat the event in spring 2025 has already been announced, with the German city of Bönen as the probable location. This commitment to ongoing dialogue bodes well for the industry’s ability to navigate the challenges ahead.
EU tubemakers welcome China seamless pipe investigation
The European Steel Tube Association (ESTA) has welcomed the anti-dumping investigation into imports from China of certain circular seamless pipes. This is a very important dossier for the European industry, a source from the association tells Kallanish.
“Low-priced Chinese imports into Europe have flooded the market for two years, creating significant harm for European producers who have seen the closure of several plants in recent years, notably in Germany with Eschweiler, Max Huette, Vallourec Mülheim and Vallourec Rath,” the representative comments. Lengthy European bureaucracy remains a key issue, he adds. The investigation should last a few months instead of two years.
The market share of Chinese imports for seamless tubes in Europe increased from 3.8% in 2021 to 7% in 2022, reaching 12.6% in 2023, “knowing that there are already anti-dumping measures on imports of stainless steel seamless tubes as well as seamless tubes in diameters greater than 406.4mm from China,” he notes.
“In terms of timing, the investigation will take a maximum of 14 months. It should publish definitive measures by July 2025 but provisional measures may be applied after seven months [from the start of the investigation] in December 2024. If the commission decides to apply import registration, which was requested by ESTA in the complaint file, then retroactive measures can be applied four months after the complaint was filed in September 2024. The news of the start the investigation should already deter some imports,” the source concludes.
The European Commission initiated last week an anti-dumping investigation into imports from China of certain circular seamless pipe of an external diameter below 406.4mm and carbon equivalent value (CEV) below 0.86. The probe follows a complaint lodged in April by ESTA. The products under investigation fall under EU TARIC codes 7304191020, 7304193020, 7304230020, 7304291020, 7304293020, 7304312030, 7304318030, 7304395030, 7304398230, 7304398320, 7304518930, 7304598230 and 7304598320.
Last year, the Commission confirmed the extension of existing anti-dumping measures on imports of certain seamless pipe of an external diameter exceeding 406.4mm originating from China (see Kallanish passim).
Natalia Capra France
Thyssenkrupp approves sale of tk Steel stake
The thyssenkrupp AG supervisory board has approved the participation of energy company EP Corporate Group (EPCG) in thyssenkrupp’s steel business.
EPCG is to acquire 20% of thyssenkrupp Steel Europe. The executive board of thyssenkrupp AG reached an agreement in principle with EPCG at the end of April (see Kallanish 26 April).
Notably, the vote was decided by the supervisory board chairman’s second vote, which went against the votes of employee representatives. Union IG Metall was quick with issuing a statement of its own on the decision. The result based on the double vote of the chairman “has buried the last hopes for a fair and democratic co-existence [of employers and employees],” says thyssenkrupp Steel shop chairman Tekin Nasikkol.
The union emphasises it does not oppose the participation of EPCG in principle. However, it criticises the quick speed of the process as “blind activism”, during which it was not kept properly informed, IG Metal claims.
Meanwhile, thyssenkrupp AG underlines that the entry of EPCG combines the materials capabilities of thyssenkrupp Steel Europe with the energy expertise of EPCG. The group notes that the strategic partnership is a significant contribution to safeguarding the future of the steel industry in Germany.
Christian Koehl Germany