US Steel Kosice third-quarter shipments decline, anticipates further weakening
US Steel expects its Kosice (USSK) plant’s fourth-quarter performance to be weaker versus Q3 given weak underlying demand and pricing conditions, and the absence of positive CO2 allocations. A one-time favourable CO2 allocation adjustment offset the weak market environment in Q3, Kallanish notes.
USSK’s steel shipments fell 6% on-year in Q3 to 899,000 net tons, with averaged realised sales price also down 6% to $802/net ton. Raw steel production was down only 2% to 970,000nt, meaning 77% capacity utilisation versus 79% a year earlier.
Net sales dropped 12% on-year in Q3 to $721 million but Ebitda almost quadrupled to $39m. The latter was due to the adjustment related to the reserve for CO2 emissions and lower coal, PCI, and iron ore costs. Moreover, USSK enjoyed lower energy cost and favourable foreign exchange impact.
In Q4, USSK anticipates lower volumes and average selling prices versus Q3. It also foresees negative impact from volume inefficiencies, higher energy costs and repair costs related to unplanned downtime at the #1 Caster. There should be a favourable impact from inventory adjustments.
USSK’s blast furnace no.1 remains offline following a planned 30-day outage in August, reflecting weak demand. This means 1.6m nt/year of the plant’s 5m nt/y hot metal capacity is idle.
The firm’s shipments in the nine months through September inched down only 1% on-year to 2.85mnt, with raw steel output down 8% to 3.03mnt and capacity utilisation at 81% versus 88%. Net sales fell 11% to $2.43 billion, while Ebit fell 48% to $13m.
Adam Smith Poland
Subdued prices impact Tata Steel UK, Netherlands
The performance of Tata Steel’s UK and Netherlands operations was impacted by weaker steel prices in the fiscal half-year through 30 September, Kallanish learns.
Tata Steel’s UK operations reported revenue of £600 million ($779m) during the second quarter of fiscal 2025, while Ebitda loss stood at £147m. Liquid steel production was 390,000t, while deliveries were at 630,000t.
On a half-year basis, revenue stood at £1,246m and Ebitda loss at £238m.
Tata Steel chief financial officer Koushik Chatterjee says: “Our performance in the UK and Netherlands was adversely impacted by the compression in steel spreads. Further, the UK was also weighed by the transitory nature of operations as the blast furnaces were safely decommissioned and steel stock was built up to operate downstream.”
Port Talbot ceased iron making on 30 September, and has since confirmed it has selected Tenova to supply the EAF for the site.
“We have completed public consultation on the planning application and anticipate commencing large scale site work around July 2025. During our transition to green steel, we will operate our downstream operations by sourcing substrate. This will help us sustain our significant market presence across steel end use segments in the UK,” Chatterjee added.
The group’s chief executive, T V Narendran, notes: “[Q2] also marked the closure of our blast furnaces in UK. We have signed the grant funding agreement with the UK government and are progressing on the proposed transition to green steel. We remain fully committed to supporting affected employees and have offered the best ever package of support in Tata Steel UK.”
The UK government confirmed in September Tata’s £500m in funding for the transformation.
Subdued steel prices also weighed on performance in the Netherlands. Revenue for the segment in Q2 was £1,300m and Ebitda was £22m. Liquid steel production was 1.66 million tonnes and deliveries at 1.5mt, which the company says increased on a year-on-year basis.
For H1, revenue was £2,644m and Ebitda was £65m.
Narendran adds: “We are undertaking pilot projects to avoid or convert captured carbon emissions.” Chatterjee meanwhile confirms: “We are engaged with the government on support for the decarbonisation of our operations.”
Carrie Bone UK
UAHE leads solidarity initiative for Spanish flood victims
The Unión de Almacenistas de Hierros de España (UAHE) has launched a solidarity campaign to support the victims of the devastating floods in the Valencian Community.
In response to the tragic events, UAHE has opened a dedicated bank account to raise funds, which will be entirely donated to the Spanish Red Cross.
UAHE is calling on all its members and the general European colleagues to participate in this initiative and make a donation.
IBAN: ES050030-1525-400000456271
Holder: Unión de Almacenistas de Hierros de España (UAHE)
Message: Emergency (followed by the EORI or VAT number)
Every donor will receive a certificate from Red Cross, so we ask you to contact EUROMETAL to get the document.
This solidarity action demonstrates the commitment of the steel sector to society and its willingness to help in times of crisis. UAHE hopes that this initiative will inspire other companies and organizations to join the cause.
UAHE thanks all contributors for their generosity and is confident that, through united efforts, they can alleviate the suffering of the victims and contribute to the reconstruction of the affected areas.
European HRC prices largely stable, expectations about market developments mixed
Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €558.75 ($609) per tonne on Wednesday, up by €2.08 per tonne from €556.67 per tonne on Tuesday.
The index was up by €4.37 per tonne week on week and by €17.92 per tonne month on month.
Mills in Northern Europe were heard offering HRC for the first quarter of 2025 at €600-620 per tonne ex-works, and in some cases, offers were as high as €640 per tonne ex-works.
These price levels, however, were still not accepted in deals, Fastmarkets understands.
But expectations for price increases seem to have supported a slight pick-up in trading, industry sources told Fastmarkets.
Some deals for HRC were reported at €560-570 per tonne ex-works.
Buyer sources estimated the workable market level at €550-560 per tonne ex-works.
But expectations about how the HRC market will develop in the short and medium term remained mixed, Fastmarkets heard.
Mills in Northern Europe were hoping for a price rebound in the first quarter of 2025, supported mainly by the limited imports of HRC.
A recent string of trade defense measures, including a steel safeguard review and an anti-dumping investigation into HRC imports from Japan, Vietnam, India, and Egypt were likely to result in a stronger reliance on domestic supplies, and that should support a recovery in domestic flat steel prices in Europe, participants have told Fastmarkets.
But some industry sources remained skeptical, saying that any price rebound would be short-lived because demand from the main steel-consuming sectors remains low.
“Any [price] rebound in 2025 will result in a very quick fall after that because [the potential price increase] would be supplier-driven,” a trader told Fastmarkets.
In Southern Europe, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Italy at €551.67 per tonne on Wednesday, unchanged from the previous day.
The Italian index was up by €0.24 per tonne week on week and by €16.67 per tonne month on month.
Offers for HRC in Italy for the first quarter of 2025 were heard at €620 per tonne delivered, which would net back to €610 per tonne ex-works.
But no deals have been reported at these levels.
“There is not a single transaction, even no negotiations at these levels,” a buyer source based in Italy told Fastmarkets.
December-delivery material was also available in the market at €580-590 per tonne delivered, which would equal €570-580 per tonne ex-works, industry sources told Fastmarkets.
But market activity remained subdued.
Fastmarkets’ sources estimated the workable market level at €540-560 per tonne ex-works.
The buyer source added that there were very few transactions recently due to a mismatch of price ideas among buyers and sellers, with producers offering too high levels, and buyers hoping for more significant discounts.
Trading with imported HRC also remained quiet.
“There is not a single viable option in terms of imports,” the buyer source said.
Local buyers were reluctant to accept HRC offers from the Asian mills due to the trade risks, while offers from Turkey, seen as the only “safe” origin recently, remained at comparatively high levels to be workable.
Turkish HRC was on offer to Italy at €580-600 per tonne CFR, including the anti-dumping duty, Fastmarkets understands.
Steel, auto interests make wishlist for president-elect Trump
American Iron and Steel Institute president and chief executive officer Kevin Dempsey said in the Wednesday November 6 statement that steel took center-stage during the election — and it should remain in the limelight throughout President Trump’s second term.
“Steel has been front and center during the presidential campaign and we are confident the concerns of our industry and its workers will receive priority attention by the incoming Trump administration,” he said.
Key priorities include trade enforcement and “preservation of the Section 232 steel tariffs that President Trump instituted in his first term.”
Also high on the agenda are tax reforms, a mandate for US-made steel in infrastructure projects, and “ensuring that government regulations do not adversely impact industrial competitiveness.”
“We are looking forward to working closely with the president-elect and his team to see these goals become a reality,” Dempsey said, adding that he was pleased that the majority of the Congressional Steel Caucus in the US House of Representatives was also re-elected.
AISI’s statement follows a strong showing of support from the US steel sector, which benefited heavily from the president-elect’s first term due to his protectionist measures.
In 2018, just over a year into President Trump’s first term and the year in which he enacted the blanket 25% tariffs on steel and aluminium, Fastmarkets’ hot-rolled coil index, fob mill US Midwest rose to a yearly average of $41.37 per hundredweight ($827.40 per short ton) from a yearly average of $31 per cwt in 2017.
One steel producer source said that most end-users were “pretty agnostic” to the winner of the 2024 election.
“The most important thing in the eyes of the steel market, and all markets for that matter, is that the election is over without weeks and months of legal wrangling,” the producer said. “Now we can get to work knowing what lies ahead.”
One steel buyer said that President Trump is likely to hit China hard with tariffs in his second-term, as promised. Other trading partners — and some domestic industries — will be collateral damage.
“Inflation and interest rates will be higher as the result of the tit-for-tat trade wars,” the buyer said. “Global trades will negatively be impacted. Automotive will likely suffer even more as affordable prices become a big factor. Ag and equipment manufacturers may also suffer as China shifts grain purchases to Ukraine, Brazil, and Argentina. Like him or hate him, he will deliver a roller coaster ride for the next four years with [Tesla chief executive] Elon [Musk] and [politician] Robert Kennedy Jr. in his cabinet.”
Musk’s name came up again in reference to black mass, the result of electric vehicle battery recycling.
A black mass source said that markets would likely remain static till January, when the president-elect takes office. After, they “expect less grants and funds” than they received from the former administration, but speculated that Musk might prod then-President Trump to aid the EV sector during his second, non-consecutive term.
Trade tariffs a ‘stick’ to achieve policy goals
Other steel market participants said that Trump would likely use tariffs as “a stick” to accomplish his policy goals.
“I think Trump uses tariffs as bargaining chips, that is his stick, to get what he wants from the foreign countries,” a southern steel distributor said.
“There are too many moving parts in the automotive trade between US and Mexico to say whether a Trump presidency will be good or bad for the auto industry overall,” the distributor added.
A trader said that Brazil, Mexico and maybe even Canada might be in Trump’s tariff crosshairs.
“I think there will a lot more duties and taxes,” the trader said. “I think Trump may impose duties on Mexico and Brazil, maybe even Canada.”
The trader stressed that the US-Mexico trade is “complex.”
“Nucor sells a lot of galvanized steel into the Mexican auto parts making plants, SDI’s Sinton mill as well sells to Northern Mexico — so what will happen if Trump’s tariffs and policies disrupt the flow?” the trader said.
“US also buys a lot of agricultural products from Mexico — this is Trump’s strategy; he will first impose tariffs and then get the country to do what he wants,” the trader told Fastmarkets.
EUROMETAL survey projects increased prices despite lower activity
European steel distributors association EUROMETAL’s October market sentiment survey shows the majority of respondents expect prices to increase slightly in the coming three months. Activity is expected to decline slightly, except for in the steel trading segment which projects a slight increase.
This comes amid European mills’ attempts since early October to raise coil prices, after values plummeted throughout September. The attempts have been largely unsuccessful so far.
Although stock levels are, on the whole, expected to remain unchanged, a large portion of flat steel service centres indicated they would increase in the coming months, whereas traders projected a decline.
In terms of end-use markets, survey respondents serving the automotive, construction, machinery and white goods sectors foresee slightly lower activity in the coming period, albeit alongside slightly higher prices. The energy, packaging and tubes segments meanwhile expect slightly increased activity with slightly higher prices.
Notably, by region, respondents in France, Portugal and the Visegrad expect slightly lower activity despite higher prices. Meanwhile, Western Europe – made up of Austria, Belgium, Germany, Luxembourg, Netherlands – is the only region expecting unchanged prices in the coming three months – to add to slightly lower activity.
“While current activity levels remain stable, future activity is expected to weaken. Distributors are maintaining a conservative approach to inventory, aligning stock levels with anticipated market softness,” EUROMETAL says in its release dated 1 November. However, there’s a notable shift in price expectations, with some respondents foreseeing stabilisation or slight increases, suggesting that price pressures might ease as the market recalibrates.”
EUROMETAL divides the survey replies into three sets – “customer sector”, meaning association member type; “customer region”; and “responder activity”, referring to the end-use sector served.
Adam Smith Poland
German distributors still postponing restocking: Klöckner’s Kerkhoff
Distributors in Germany remain reserved when buying larger volumes of steel for their inventories, according to Klöckner & Co chief executive Guido Kerkhoff.
The point of replenishing the shelves has not yet been reached, Kerkhoff said during a conference call on Wednesday when asked by Kallanish for the status quo of distributor and service centre buying behaviour. Regular business with a continuous turnover of products is not yet in sight. “I think the status quo is that people buy only as much as they are expecting to sell,” he replied.
He alluded that prices are starting to see some gentle recovery, but real demand is yet to improve. Nevertheless, he is not completely pessimistic. “Warehouses are still relatively empty, but, yes, I do believe that the point of return to business will come,” he noted.
His estimation is reflected in the outlook the company gives for the fourth quarter, and ultimately for the whole of 2024. In Europe, it sees a drop in real steel demand by 1-3%, with the transport/automotive segment pointing more steeply downwards than construction, mechanical engineering, or household appliances. The one sector with relatively stable demand is energy. “It does not look like activity will increase, but we are at an already low level,” Kerkhoff said.
The group is overall more upbeat about performance and prospects in its other big market, the USA, but here, too, sees a slight dip of between 0% and 1% in demand from its customer industries. However, “this is quite normal in an election year with the insecurities this brings,” he concluded.
Christian Koehl Germany
ArcelorMittal Kent Wire considers future after government decision
ArcelorMittal Kent Wire (AMKW) tells Kallanish it is “surprised” by the UK government’s view regarding the planning decision over Chatham Docks, which could see the company end manufacturing at the site as a result.
The UK government chose not to call-in the application, resulting in Medway Council approving the redevelopment of Chatham Docks.
Kent Wire managing director Matt Brooks says: “We can confirm we received a letter from the Government saying the future of Chatham Docks is a local planning decision to be made by Medway Council alone.”
“We are extremely surprised by this view given the significance of the Docks for the entire steel and construction sectors and we are now considering our next steps on this matter given the potential damage the closure of the Docks will cause to the economy,” he adds.
The company has been part of a campaign to save the site where it has manufactured for 35 years and says its supplies over 30% of UK construction steel needs.
Brooks has previously said industrial sites such as Chatham Docks should be safeguarded to enable companies to play a part in delivering major infrastructure projects.
Carrie Bone UK