EU trade barriers boost Polish distributors’ profitability
The introduction in the EU of CBAM and the new trade regime has stabilised and lifted steel prices, thereby improving the profitability of Poland’s stock market-listed steel distributors, Kallanish notes.
Demand and prices stabilised in the first half of 2026 following an earlier period of market correction, says distributor Bowim. Higher second-quarter prices on-year and the use of the first in first out (fifo) inventory method resulted in increased steel trading profitability, Stalprofil notes. Polish market participants also anticipate support from Poland’s local content scheme, which aims to raise domestic suppliers’ share in public infrastructure projects, it adds.
Bowim’s standalone first-half revenue fell 6% on-year to PLN 842.4 million ($228.2m) but the firm turned to a PLN 17.9m net profit versus a year-earlier loss of PLN 1.3m.
Stalprofil saw standalone H1 revenue rise 7% to PLN 579.1m and net profit balloon by 1,960% to PLN 10.2m.
Bowim however notes that “the market environment remains volatile, particularly in terms of energy costs, the pace of demand recovery in steel-consuming sectors, and geopolitical risks. In the company’s opinion, the gradual improvement in economic activity and the applicable regulations and trade conditions in the European Union may support the stabilisation of sales volumes and pricing conditions.”
Electrical steel and cold-formed sections producer Stalprodukt however had contrasting fortunes in H1. The firm has not yet published its preliminary results, but did specify that H1 electrical steel segment revenue dropped 36% compared to the average revenue for H1 2024 and 2025.
The decline is attributed to the “significant increase in sheet metal imports to Europe at prices notably deviating from European cost factors,” the firm notes. “The unfavourable cost factors that processors of steel, including transformer sheet, struggle with in international competition have deteriorated further. In the issuer’s opinion, this situation is the result of the conditions of carrying out production activities in the European Union.”
Author: Adam Smith
IW Köln pleads for retaining domestic steel production
The Cologne Economic Institute (IW Köln) has called for steel production to remain in Germany and Europe, and warns against relocating entire production stages.
In a recent study seen by Kallanish, it discusses challenges like high energy costs and low availability of hydrogen, against the backdrop of the steelmaking energy transition. European mills’ transition has been questioned by some who recommend that ironmaking via the DRI route be left to countries with abundant energy supply, for example in the Middle East.
IW Köln underlines that Germany’s manufacturing industries are intensely interwoven in a value chain characterised by international strength and sizeable exports. If parts of the chain break away, others will follow. According to IW Köln, half a million jobs in Germany are directly dependent on the steel industry, when including suppliers and direct customers. When ancillary steel-based industries are also taken into account, this figure could rise to 5 million jobs, the institute points out.
It also underlines the importance of regional proximity between business partners, and highlights security as one factor. Many overseas locations with low energy costs lack other basic prerequisites, like political stability and a functional transport infrastructure.
IW Köln concedes that imports of hydrogen and sponge iron could play a role in the German steel industry, which might need to reposition itself in an adjusting value chain.
In a reaction piece on LinkedIn, Salzgitter chief executive Gunnar Groebler agrees with IW’s findings. “A comparison limited to production costs is short-sighted. It ignores overall costs, risks and reliability of supply,” he writes.
A functional circular economy in Europe will only work on short distances, because transport costs are becoming the crucial driver to an increasing extent, Groebler writes. “You can always get your steel cheaper somewhere else. But what is the price for losing capacities?” he asks.
Author: Christian Koehl