Day: 24 July 2024

Global crude steel production in the first half of 2024 totaled 954.6 million mt, steady year on year, according to World Steel Association data July 23.

The June total was 161.4 million mt, up 0.5% year on year, but down 2.1% on the month, the data showed.

The largest producer China had an output of 91.6 million mt in June, up 0.2% year on year but down 1.35% from May and making up 56.8% of the total volume. That took H1 volume to 530.6 million mt, down 1.1% year on year.

The second-largest producer India produced 12.3 million mt in June, up 6% year on year and up 0.3% on the month, with the H1 volume up 7.4% on the year to 74.2 million mt.

In June, Japan produced 7 million mt, down 4.2% year on year and 2% lower than May, with the H1 total at 42.7 million mt, falling 2.6% year on year.

The US produced 6.7 million mt of crude steel in June, down 1.5% on the year and 3% lower on the month, while Russia was estimated to have produced 6 million mt in June, down 4.1% on the year and falling 3.2% from May.

In H1, the US produced 40 million mt and Russia 36.8 million mt, down 2.4% and 3%, respectively, year on year.

South Korea produced 5.1 million mt in June, down 7.2% on the year and 0.85% lower on the month, taking the H1 total to 31.5 million mt, down 6.4% from H1 2023.

Turkey produced 3.1 million mt, up 4.3% from June 2023, but down 4.4% from May, with the H1 volume up 16.9% to 18.6 million mt.

In June, Iran produced 2.6 million mt, down 8.5% year on year and 19.7% lower than May, while Brazil produced 2.9 million mt, up 11.8% on the year and 11.2% higher from May.

 

EU June volume rises 5.1% on year
The EU produced 11.1 million mt in June, up 5.1% on the year, but down 5.7% from May. In H1, the EU produced 67.2 million mt of crude steel, up 0.9% on the year.

Germany, the region’s largest steelmaker, saw June production rise 8.9% year on year and remain steady on the month to 3.2 million mt, bringing the H1 volume to 19.4 million mt, up 4.5% on the year.

According to data from German Steel Federation (WV Stahl), Germany’s H1 electric steel production increased 8.7% on the year to 5.89 million mt, while its production via blast furnace rose 2.7% to 13.48 million mt.

Germany’s production of hot rolled coils in H1 rose 3% on the year to 16.72 million mt, VW Stahl said.

“Crude steel production seems to have passed the deepest valley. However, it is questionable how sustainable this development is,” VW Stahl Managing Director Kerstin Maria Rippel said in a statement

“Even after 2023, the weakest year in demand since the financial crisis, the steel industry is still lacking urgently needed demand impulses from the important steel-processing sectors,” Rippel said.

Mechanical engineering, the automotive industry and the main construction industry continued to struggle with weak international demand, the crisis in housing construction and a lack of investment at home and in the EU, Rippel said.

In June, Platts, part of S&P Global Commodity Insights, assessed HRC prices in a range of Eur625-635/mt ($678-$689/mt) base ex-works Ruhr. The price was assessed at Eur625/mt ex-works Ruhr July 22, down 9.4% since the start of 2024.

Meanwhile, global production of pig iron from 37 countries was 642.4 million mt in H1, down 2.55% year on year, the data showed.

Direct reduced iron produced in 13 countries in H1 amounted to 61.6 million mt, rising 6.9% year on year, according to worldsteel.

The crude steel data covers 71 countries that report to worldsteel, accounting for about 98% of the world’s crude steel production in 2023.

Annalisa Villa | Jacqueline Holman

European domestic hot-rolled coil prices remained unchanged July 23, with sources expecting the market to significantly weaken in the month of August, particularly in Southern Europe, before any signs of strengthening are seen.

“Quiet market,” a service center source said. “Nobody is trying to buy or restock,”

Sources noted that, although market fundamentals remain sluggish, demand may pick up after the summer season as stocks begin depleting and demand improves.

“We have seen a similar month,” the source said. “There is low demand but there have been some signal of things picking up.”

“From September to October, [prices may] bounce back,” another service center said. “At the moment, there is no demand at all.”

However, the recovery in demand is likely to remain sluggish on a lack of overall end-user demand, sources said.

Platts assessed Northwest Europe HRC at Eur625/mt ex-works Ruhr July 23, stable on the day. Tradable values were reported at Eur620-630/mt EXW Ruhr.

Meanwhile, Platts assessed domestic HRC prices in Southern Europe stable on the day at Eur625/mt EXW Italy July 23. Tradable values were reported at Eur610-630/mt, with the majority of the data heard at Eur620-630/mt EXW Italy.

Devbrat Saha | Geraint Moody

The permanent closure of ArcelorMittal Poland’s coke oven battery in Krakow will not affect the output of semi-finished and flat steel products from either of the company’s plants in Krakow and Dabrowa Gornicza, a spokesperson told Fastmarkets on Tuesday July 23.
On July 19, ArcelorMittal Poland announced that it had decided to close the Krakow coke plant permanently. It had until then been hot-idled for eight months.

“At the end of last year, the only coke oven battery in Krakow was hot-idled,” Wojciech Koszuta, the chief executive officer of ArcelorMittal Poland, said. “Hot-idling of this plant allowed for the possible resumption of coke production if market conditions improved. Unfortunately, this has not happened.”

He added that a standstill process such as hot-idling was very costly due to the high price of the natural gas used to fuel the installation. Consequently, keeping the plant on that status was not economically justified.

“In addition, the decarbonization plans of many industries in the coming years will gradually reduce the demand for coke,” a company press release said.

In October 2020, the company permanently closed the hot zone at the Krakow steel mill due to the dramatic effects of the Covid-19 pandemic on the European steel market. The coke plant and rolling mills had remained operational.

“The coke oven battery in Krakow has capacity for 650,000 tonnes per year,” the company spokesperson told Fastmarkets, and this was used to feed the blast furnaces at Dabrowa Gornicza, which in turn produces slab for the hot-rolling and cold-rolling mills in Krakow.

As a result, after the closure of the coke oven battery, the rolling mills will be the only facilities operating at ArcelorMittal Poland’s site in Krakow. It produces hot-rolled coil, cold-rolled coil, hot-dipped galvanized coil and organic-coated coil.

“The permanent closure of the coke plant in Krakow will not affect the production at our other plants,” the spokesperson told Fastmarkets, adding that the company produces coke at its coke plant in Zdzieszowice, which is around 160km from Krakow and has capacity for around 4 million tpy of coke.

“[This unit] ensured continuity of production during the hot-idling of the Kraków coke plant, and we will have no problems now about the availability of coke,” the spokesperson added.

According to Fastmarkets’ sources, the closure of the coke oven battery in Krakow will not have a significant effect on the local market for flat steel products.

“The situation with HRC [in Poland] is dire, and I do not think it will change much,” a distributor source told Fastmarkets.

Prices of HRC in Central Europe have been largely stable in recent weeks. Local mills were hoping to increase prices for October-delivery coil, but slow demand was seen as a major obstacle for a price rise.

As a result, Fastmarkets’ most recent weekly price assessment for steel hot-rolled coil, domestic, exw Central Europe, narrowed downward to €620-630 ($675-686) per tonne on July 17 from €620-635 per tonne the previous week.

Published by: Julia Bolotova, Darina Kahramanova

Hot-rolled coil prices across Europe remained broadly flat on Tuesday July 23, with thin trading in the spot market due to a seasonal slowdown and weak consumption, sources told Fastmarkets.
In Northern Europe, integrated mills were heard offering September-delivery HRC in the range of €625-650 ($680-708) per tonne ex-works. Some suppliers still had late-August delivery coil available, sources said.

Buyers remained at the sidelines, only booking what was strictly necessary, Fastmarkets heard.

Transactions for small tonnages of HRC were reported at €625 per tonne ex-works in Germany, in line with buyers’ estimations of tradeable prices at €620-630 per tonne ex-works.

“Stocks are sufficient at most buyers, and demand [from end users] remains on the low side,” a buyer in Germany said.

Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €628.25 per tonne on Tuesday, down by just €0.75 per tonne from €629.00 per tonne on Monday July 22.

The index was down by €3.00 per tonne week on week and by €1.75 per tonne month on month.

Sources said that, for October-delivery HRC, European mills were targeting higher offers at €660-670 per tonne ex-works.

But most industry sources told Fastmarkets they questioned the possibility of a price rebound, considering a lack of demand and oversupply in the market.

“The capacity utilization rate at most EU mills is no higher than 70%, even lower than that at some producers — and nobody misses the volumes [of HRC],” a mill source in Europe said. “And ports are full of imported HRC.”

Sources agreed that domestic prices were unlikely to decrease further.

“Mills have to be cautious of costs. And import pressure has alleviated with new safeguards in place — yes, there is still plenty of import [HRC] at the ports, but prices are mostly in line or only slightly below European [prices]. That supports the [low end of domestic HRC prices],” a second producer source said.

Meanwhile, in Southern Europe, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Italy at €621.25 per tonne on Tuesday, down by €0.42 per tonne from €621.67 on Monday.

The index was up by €1.25 per tonne week on week but down by €7.50 per tonne month on month.

September-delivery coil was still widely available from Italian and other European suppliers, with offers reported at €640-650 per tonne delivered (€630-640 per tonne ex-works).

Buyers in Italy reported bids at €610-620 per tonne ex-works.

Buyers and sellers reported estimations of tradeable prices at €620-640 per tonne ex-works, depending on the volume.

Trading in the country remained thin, and a post-summer rebound was put into question.

“There was talk of €20-30 [per tonne] price rises for October-delivery coil, but demand is not strong enough to support it,” a buyer in Italy said.

Meanwhile, several sources reported HRC offers from Vietnam at €570 per tonne CFR to Southern Europe.

One source reported an offer from a Vietnamese mill to the Iberian market at €540 per tonne CFR, but sources suggested it was for a large tonnage.

From Saudi Arabia, offers to Italy were heard at €610 per tonne CFR.

From Japan, offers were heard in the range of €580-600 per tonne CFR, depending on the supplier.

Turkish mills were reportedly offering HRC to Southern Europe at €600 per tonne CFR, including the anti-dumping duty, and a deal was heard done at €590 per tonne CFR to the Iberian market at the end of the previous week.

Most overseas suppliers were offering September- or early-October-shipment HRC to Europe.

Published by: Julia Bolotova

Global crude steel production inched up 0.5% on-year in June to 161.4 million tonnes – but fell 2% versus May – as Indian and EU production growth offset declines in the US, Japan and Korea, Kallanish notes.

Chinese output rose 0.2% on-year to 91.6mt, but was down on-month, while Indian output grew 6% on-year to 12.3mt, and was also up on-month. Japanese and Korean production fell 4.2% and 7.2% respectively to 7mt and 5.1mt, according to worldsteel data.

EU27 production actually grew handsomely, by 5% on-year to 11.08mt, but remained down versus May. The on-year comparison comes from a low base, after EU mills cut output 11% on-year in June 2023.

The growth was due to German production surging 8.9% on-year in June to 3.2mt, while Spanish output rose 8% to 990,000t and French output by 3% to 729,000t. Italian production meanwhile dropped 3% on-year to 1.85mt.

Compared to May, however, Spanish and French output were down 11% and 28% respectively. Italian output fell 4% and German production was unchanged.

Turkish production rose 4% on-year in June to 3.07mt.

US output declined 1.5% to 6.66mt but Brazilian production surged 12% to 2.87mt.

Russian production was estimated down 4% to 6.03mt and Ukrainian production was confirmed up 68% to 735,000t.

Crude steel output in the 71 countries monitored by worldsteel was thus down only 100,000t on-year in the first half of 2024 at 954.6mt, as slightly lower Chinese and Japanese output were offset by growth in India, Germany and Turkey.

Adam Smith Poland

Italian stainless long steel producer Cogne Acciai Speciali is investing in the modernisation of its Aosta plant in Italy by revamping the cooling chamber of the continuous casting machine for special steel blooms.

The goal is to enhance machine efficiency and simplify maintenance activities, Kallanish notes. The upgrade will be carried out during this year’s four-week summer shutdown.

As part of the intervention, a new cooling chamber made of stainless steel will be installed in the mobile curved zone, covering the wet zone that has been impacted by secondary sprays. With this design, there will be a significant decrease in the amount of saturated air that needs to be aspirated, resulting in substantial electricity savings for the fans and a noticeable reduction in maintenance time, says Danieli, which is revamping the unit.

The work will include a series of new roller modules; new hoods, designed for heat containment and ease of operation and maintenance; and new extraction guides for all operational stirrers across various casting lines. This will make operations more efficient and give them a longer lifespan, Danieli notes.

Cogne, a subsidiary of Taiwanese stainless steelmaker Walsin Lihwa, completed this year the acquisition of its main stainless steel scrap supplier, ComSteel Inox, as well as part of Outokumpu’s long products business in Degerfors and Storfors, Sweden.

Since it was acquired by Walsin Lihwa, the steelmaker has expanded through a series of mergers. Last year, it completed the acquisition of Sheffield-headquartered Special Melted Products (SMP). Walsin is investing over €110 million ($119m) in Cogne’s Aosta plant between 2022-2024. The growth strategy involves gaining market share in Europe and Asia, and developing the group’s presence in the US (see Kallanish passim).

Natalia Capra France

According to Minister of Enterprises and Made in Italy Adolfo Urso, the Italian government plans to begin the process of allocating Acciaierie d’Italia (ADI)’s Taranto steelworks by the end of July. Urso told local press this week he has scheduled meetings with two potential buyers who are interested in acquiring the troubled steelmaker.

Urso confirmed his intention to meet with trade unions and ADI’s special administrators on 25 July to discuss the new industrial plan for the relaunch of Taranto. The steelmaker’s management is once again undergoing a reshuffling. Alessandro Faroni will take over the role of commercial director, succeeding Andrea Bellicini.

The Italian government has set aside approximately €1 billion ($1.09 billion) from the country’s development fund for a direct reduced iron plant in Taranto, Kallanish notes. Authorities will also provide support amounting to €700 million to whichever company acquires ADI’s production equipment. The steelmaker will need to allocate about €1 billion to address the damage to its equipment that occurred during the previous administration.

The project is set to commence by the end of this year, with the new special administration planning to allocate approximately €400m in payments in 2024 (see Kallanish passim). Meanwhile, production at Taranto continues to be limited, with blast furnace no.4 the sole operational BF.

Natalia Capra France

Spanish rebar prices have moved up after a month of stability. The increase comes ahead of planned stoppages at large manufacturers, Kallanish learns from market sources.

“Local demand is in a good momentum, supported by private projects after a quiet few months. Major public infrastructure works have also been unblocked and July looks set to be one of the best months so far this year for long steel sales,” one stockist says.

According to another source, the latest price increase of €15-20/tonne ($16.3-21.7) has been driven by the absence from the market of Spanish manufacturers in the coming weeks. “Large local mills are closing deals at higher levels ahead of their annual stoppages in August. The new levels could last until the end of the summer,” a seller comments.

“Steel mills’ demand forecasts for the summer have been very tight due to market uncertainty. Producers have carried out only small stocking ahead of the August closures and, if demand continues at this rate, there may be material shortages in some regions, even though it is a holiday period,” the source adds.

The monthly index for Spanish domestic rebar prices in July rose by 1.65% over the previous month, according to data published by the Spanish Chamber of Commerce. The index is almost 7% higher year-on-year and stood at 175.29 in July. It is based on a value of 100 in 2014.

16mm rebar is currently being offered in Spain at €368-373/t ($400-405/t) base. Including €262/t size extras and loading expenses, transaction values are at €630-635/t ex-works.

Todor Kirkov Bulgaria

ArcelorMittal is announcing increased prices for long products throughout Europe, according to market sources. The decision has been motivated by rising production costs and the need to regain profitability, Kallanish hears.

The steelmaker is increasing its prices for all commodity grade longs, such as rebar, beams, and wire rod, by €20/tonne ($21) above its June quotes, sources note. According to one, the rise in costs of electricity across Europe and of ferroalloys have significantly affected production cost.

Demand is at a favourable level and sellers in Europe have observed a resurgence in apparent demand in July, he adds. Customers are fulfilling their restocking requirements ahead of the August mill shutdowns in various EU countries.

The increase will take effect immediately. EU Electricity prices saw a significant 25% increase from May to June, thereby pushing up production costs, and it is anticipated that this upward trend will continue into July.

Natalia Capra France