EU demand pushes up Turkey’s steel exports in H1: association
Turkey’s steel exports revenue in H1 2024 rose 10.6% year on year to $8 billion, Mediterranean Ferrous and Non Ferrous Metals Exporters’ Union (ADMIB) Head Fuat Tosyali said in a statement July 27, without citing tonnages.
Higher demand from the EU supported H1 exports, he said, adding that mills had begun to receive the fruits of investments to comply with the EU’s Green Deal.
“We are expecting to exceed the first half growth seen in our export volumes in the second half of the year,” Tosyali said.
Turkish mills witnessed double-digit increases in exports to Italy, Romania, Spain, Greece and the UK in H1, according to ADMIB data.
Turkey, which lost its net steel exporter position and became a net steel importer in 2023 for the first time since 2015, has set a 17 million mt export target for 2024.
“Despite global challenges, Turkish steel producers have been continuing their investments to carry them one step further in global competitiveness and to provide sustainability,” Tosyali said.
Tosyali Holding’s 4 million mt/year quantum electric arc furnace-based flat steel mill started production in January, while some other large steelmakers also recently launched new steel capacities.
Platts, part of S&P Global Commodity Insights, assessed Turkish domestic hot-rolled coil at $570/mt EXW July 26, down 20% since the start of 2024.
European HRC prices remain mostly steady amid peak summer holidays
Domestic prices for European hot-rolled coil stayed mostly steady as a peak summer season continued to result in very low levels of demand and a pessimistic outlook going forward.
“It is the high season of the holidays now and the market is very quiet,” a service center source said. “I don’t think anything will happen in the next few weeks.”
“No change of the situation due to summer vacation season,” another service center source said.
The market fundamentals for coils remain strained with a combination of significantly low levels of demand and excessive levels of supply. Sources said that mills need to announce production cuts to support prices, which would otherwise fall further.
A large proportion of the strain on the industry comes from the low and sluggish growth within the European automotive sector, which is struggling to compete with its more cost-effective Chinese counterparts, market sources noted.
“Globally, prices are under pressure,” a service center source said. “With competition from Chinese electric cars, it is more or less impossible for domestic automotive producers to sell anything.”
Platts assessed Northwest European HRC at Eur625/mt ex-works Ruhr July 29, stable on the day.
Tradable values were reported at Eur605-630/mt EXW Ruhr.
Meanwhile, Platts assessed domestic HRC prices in Southern Europe at Eur620/mt EXW Italy July 29, down Eur5.
Tradable values were reported at Eur610-625/mt.
Prominox buys Outokumpu’s Mexican distribution business
Stainless-steel supplier Prominox has acquired the Mexican distribution business of Finnish steelmaker Outokumpu, Kallanish learns.
The agreement includes large centres in Mexico City, Guadalajara and Monterrey formerly known as Outokumpu Mexinox Distribution (OMD).
“We are delighted to incorporate Outokumpu’s solid distribution business into Prominox being confident that by adding the strategic locations and customer base to our portfolio, we are reinforcing our position as the leading stainless-steel distributor in Mexico,” says Prominox’s president, Ivette Autrique.
In a separate note, Outokumpu confirms that the divestment of the OMD unit is due in part to dedicate more resources to the strategic areas of Mexico and the US as the warehouses serve largely smaller volumes. “We will continue to fulfil customers’ orders that are served by OMD until the transaction with Prominox is completed,” Outokumpu adds.
The acquisition is now awaiting approval from Mexican authorities and other closing conditions. The transaction should be completed during the next few weeks.
Prominox and Outokumpu did not reveal any financial details of the agreement.
Todor Kirkov Bulgaria
Austria production falls in June despite EU growth
Austria’s steelmakers decreased crude steel production in June compared with the previous month, according to worldsteel data.
Output amounted to 633,000 tonnes, down by 2.6% from May and 0.3% less year-on-year, Kallanish notes. Austria fell from 21st place to 22nd in the ranking of top ten global steel producers, worldsteel data show.
In January-June, however, the country produced 3.81 million tonnes of steel, up 0.7% on-year.
Overall EU output in June increased by 5% y-o-y to 11.08mt. In the first six months of the year, steel production was 0.9% more on-year versus January-June 2023 to 67.2mt.
Austria’s largest steelmaker, voestalpine, said earlier market trends have not changed significantly following the start of its 2024/25 business year in April (see Kallanish passim).
In fiscal 2023/24 – ending March 2024 – voestalpine achieved satisfactory results, with overseas markets performing better than Europe. It said it expects good demand from railway infrastructure, aerospace, and warehouse technology to continue. The automotive industry and the energy sector, as its main segments, should largely continue their stable development to date.
The group’s revenue in 2023/24 was its second-highest in history, at €16.7 billion ($18.2 billion), after achieving record revenue of €18.2 billion in the previous year. Key figures have now “returned to normal” in the latest reporting year, voestalpine noted. Ebitda reached €1.7 billion, down from €2.5 billion.
In 2023, Austria’s commerce chamber, Wirtschaftskammer Österreich (WKO), expressed concern over the crash in demand and orders for commodities in the country (see Kallanish passim). WKO saw orders declining by as much as 30%, with no relief in sight.
Svetoslav Abrossimov Bulgaria
Italian HRC buyers shun imports, eye delayed clearance
Import offers for hot rolled coil from Asia into Italy have decreased by approximately €20/tonne ($21) compared to last month, but buying interest is low. Italian importers using the country’s unique customs clearance amendment system meanwhile aim to clear imported material stocked at ports by year-end.
HRC offers from Asian suppliers range from €570-580/tonne ($617-628) cfr Italy, while Turkish material is available at €570/t cfr.
According to a trader’s analysis, current spot market coil sales for import are expected to go through customs clearance only in April 2025.
Italian buyers will be able to clear through customs without duty material imported in the second quarter but left in consignment at ports no earlier than from 1 January 2025, says one Italian importer of HRC. This is because they need to clear tonnages gradually each quarter to avoid duty payment. Italy allows buyers to modify or cancel their customs clearing authorisations and use partial clearing, which is a feature unique only to this country.
Each EU country’s customs authority has the freedom to establish its own regulations while following the EU quota allocation procedure. Companies have the option to choose whether to clear the entire imported amount or only a portion of it in order to avoid paying some of the duties, according to the Italian customs authority, Agenzia delle Dogane e Monopoli (ADM).
Buyers have the option to restrict the import authorisation to only the portion of the goods that falls within the duty-free quota. Alternatively, one may choose to complete the import for the entire quantity declared and pay duties on the tonnage above the duty-free allocation.
On 1 July, a number of buyers in Italy made the decision to leave approximately 40% of their imports at ports in order to circumvent payment of the prohibitive duty. According to one source, the tonnage of coil that a buyer leaves at the port will be added on top of any newly imported quantities, with the buyer then able to decide what volume to clear in a given period.
At the beginning of each quarter, the buyer will enter the code 00100 into the ADM system, which will generate a new calculation for the portion of the goods eligible for the quota. The buyer will then assess the quantity of material to be cleared through customs.
From now until the end of the year, several importers who spoke to Kallanish intend to systematically clear the majority of imports that have been left at ports. ADM refers to this regulation as pro-rata allocation, However, sources point out that there are costs involved in transporting and storing the coil, which carries the risk of material deterioration.
Natalia Capra France
Swedish start-up GreenIron secures additional financing
GreenIron H2 AB, the relatively new Swedish player with a proprietary recycling technology that allows for iron production using hydrogen, has collected SEK 100 million ($9m) of additional financing provided by existing shareholders.
In April, it obtained the environmental permit for its first full-scale production unit in Sandviken, Sweden (see Kallanish 2 May). Construction of the facility is ongoing and the firm expects commercial production of fossil-free iron to begin by the end of 2024.
The latest financing paves the way for a larger financing round within the next six to nine months. “This enables us to continue our journey towards our goal of 300 furnaces by 2030, in the pursuit of a sustainable future,” says company chief executive Edward Murray.
Christian Koehl Germany