Slovakia-based integrated steelmaker US Steel Kosice (USSK) has restarted a second blast furnace (BF) at its Kosice facility, the company told Fastmarkets on Wednesday January 25.
A spokesperson for the company confirmed earlier this week the restart of BF2, which has a capacity of 1.8 million tonnes per year of pig iron, after almost five months of downtime.
BF2 was stopped in September 2022 due to poor market fundamentals, Fastmarkets reported.
USSK also confirmed the restart of BF1 last week.
US Steel Kosice usually has three BFs operating at any given time, with a combined capacity of 5 million tpy of pig iron. The company produces at steel products: hot-rolled, cold-rolled and hot-dipped galvanized coil.
Currently all three BFs are operational, the spokesperson told Fastmarkets.
“I can confirm that all three blast furnaces have been in operation since the start of this week [January 23],” the spokesperson said.
The news about one more BF being brought back online raised concerns among the EU at steel market participants. They were worried that the gradual restart of idled steelmaking capacities that were suspended in the fourth quarter of 2022 would threaten the recent uptrend in prices in the EU
at steel market.
Earlier in January, ArcelorMittal said it was considering restarting a BF at its facility in Gijon, in northwest Spain.
Market sources said that the sharp price rises in the at steel segment were prompted by a more balanced market, and therefore increasing steel output might hamper further increases.
Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €754.55 ($820.57) per tonne on Tuesday, up by €2.05 per tonne from €752.50 per tonne on Monday.
The latest calculation of the index was up by €39.13 per tonne week on week and by €85.80 per tonne month on month.
By Julia Bolotova
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Acciaierie d’Italia (ADI) is partnering with Falck Renewables and BlueFloat Energy to boost its use of renewable energy and optimise consumption. The firms have signed a letter of intent that will trigger a roundtable discussion about possible collaborations and synergies, a source close to the company confirms.
ADI will supply steel and other materials for the construction of floating offshore platforms for wind farms developed by a joint partnership between Falck Renewables and BlueFloat Energy. The two energy companies will return the favour by supplying renewable energy and green hydrogen for steelmaking, Kallanish notes.
Falck Renewables has vowed to help ADI build a photovoltaic infrastructure within the Taranto steelmaking facility and on the company’s land outside the plant. The partners plan to create a consortium that will involve other industrial partners and research centres. Their mission is to accelerate the use of renewable electricity for energy-intensive sectors and to develop a value chain for wind farm components production in Apulia, southern Italy.
ADI has set a production target of 4 million tonnes in 2023 and 5mt in 2024. This year, it will start revamping blast furnace no.5, which has been idled for many years. The company is planning to boost its circular economy, desalinate water at its Taranto facility and recover all by-products that can be reused within the steelmaking process but also by other industries (see Kallanish passim).
With its new decree, “Urgent Measures for Strategic National Installations”, the Italian government recently approved the injection of €1 billion ($1.09 billion) into the troubled steel producer. The funds, which will help state company Invitalia to become the majority shareholder in 2024, will also ensure the industrial development of Taranto, employment guarantees and production targets higher than those achieved by Acciaierie d’Italia in the last two years.
Natalia Capra France
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Participants at recent industry conferences in Germany expressed their thoughts on the challenges the technical transition of the steel industry will bring for the players involved.
Unlike previous investments during the forty years of his career in the steel industry, the investment campaigns in direct reduced iron and hydrogen are a venture into murky territory, says Karl-Ulrich Köhler. The chief executive of Saarland mills Saarstahl and Dillinger noted during stockholders federation BDS’s Green Day conference earlier this month that “investments used to be made on the basis of economic considerations when you had clarity about the outcome. Now it is the other way round, in order to fight climate change.”
“Colleagues of mine call it ‘hara-kiri’, but we won’t make progress if we do not start at some point. And once we start, others will follow. We are banking on a positive dynamic,” Kallanish heard him say at the conference.
A similar defiance was expressed earlier by speakers at the ecoMetals Day in Düsseldorf last September. Christian Vietmeyer of fabricators federation WSM drew a comparison with the progress that has been triggered by necessity because of Covid-19. “When the pandemic broke out, we did not have any vaccine, either, but then it came,” he said. He added: “We do see the road towards hydrogen ahead, but we need the will to go down it.”
Gunther Kegel, president of the German Electrical and Electronic Manufacturers’ Association (ZVEI) pointed at the big changes the hydrogen conversion will mean for municipal utilities during ongoing operation. “It will need investors, it will require external monitoring, and the management floors will be restructured – and we have not even started with that,” he noted. “It will be like open heart surgery.”
Christian Koehl Germany
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Investments into new technology and new sites required to achieve a transition to low-carbon steelmaking ought to be kept within Germany or the EU, German industry players say.
The transition towards direct reduced iron-based technology was a key theme at the Green Day conference organised earlier this month by German steel stockholders association BDS. Given that Germany, especially, is a country of high energy costs, the question arose if new mills should be built offshore. “Wouldn’t the investments make more sense in places where renewable energies are more abundant?” asked Heinrich Sülzle of distributor Sülzle Gruppe.
Karl-Ulrich Köhler, chief executive of the Saarland mills, concurred. “We have value chains with the highest know-how in the EU and Germans, especially, and we would be crazy giving up what has made us strong,” Kallanish heard him say. He added that offshoring for the sake of lower initial costs would be short-sighted.
Arne Langner of ArcelorMittal gave the example of the group’s mill in Canada, Dofasco, which recently received public support approval from the government. Such bureaucratic necessities are a weakness of the EU because they are time-consuming, he said. Still, the global group also plans investment at its German mills, as well a shift of technology towards DRI.
One group that already received approval for support for its plans is Salzgitter AG. Its speaker Alexander Redenius agreed that a move to other shores would shake the entire existing supply chain. “We are focusing on the sites here, and we do not want to lose them,” he affirmed.
Christian Koehl Germany
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French electrolyzer and hydrogen refueling station manufacturer McPhy grew its order book by over 50% in 2022, landing a contract for a low-carbon steel project in Germany and securing funding for its planned 1 GW/year Belfort factory, the company said in a statement late Jan. 24.
Its firm order intake rose 53% to Eur29.4 million ($32 million) in 2022, with a portfolio of 45 MW of electrolysis and 40 hydrogen filling station projects signed, commissioned or under execution as of Dec. 31, 2022.
The company is a preferred partner or selected supplier for a further 148 MW of electrolyzers and 56 stations.
“These are the first indications of upcoming deployments in low-carbon hydrogen as the market is getting more structured,” CEO Jean-Baptiste Lucas said in the statement.
Lucas said the first national grants from the EU’s Important Projects of Common European Interest (IPCEI) would “foster the development of production capacities and will shortly be followed by a second wave of funding, which will fuel demand and the transition to larger-scale projects.”
McPhy took a final investment decision and started construction of its 1 GW/year production facility in Belfort, France, following a successful IPCEI grant application in 2022.
McPhy received a first payment of Eur28.5 million from the French state, as part of a Eur114 million grant.
The plant is due to start operations in the first half of 2024, ramping up gradually to reach 1 GW/year production capacity.
The gigafactory “will allow us to lower the cost of our electrolyzers and increase their capacity in order to provide competitive low-carbon hydrogen very quickly,” Lucas said.
In the meantime, McPhy has scaled up capacity at its San Miniato factory in Italy to 300 MW/year to meet demand while waiting for the Belfort plant to come online.
Platts, part of S&P Global Commodity Insights, assessed the cost of producing renewable hydrogen via alkaline electrolysis in Europe at Eur8.45/kg ($9.18/kg) Jan. 24 (Netherlands, including capex), based on month-ahead power prices. PEM electrolysis production was assessed at Eur10.25/kg, while blue hydrogen production by steam methane reforming (including carbon, CCS and capex) was Eur4.12/kg.
McPhy secured an equipment order at the end of 2022 from an industrial joint venture for low-carbon steel production in Germany, close to the company’s design and engineering site in Wildau.
It covers two 1-MW electrolyzers and a dual pressure 350/700 bar fueling station for forklift trucks and trailer trucks, McPhy said, with a five-year services contract.
First steel deliveries from the project are expected in the first half of 2024.
McPhy said the order highlighted “the relevance of the group’s European operating setup.”
Some in the industry fear electrolyzer producers outside Europe could develop a competitive advantage through cheaper manufacturing, such as in China and elsewhere.
Other electrolyzer manufacturers are facing problems scaling up. The UK’s ITM Power is reviewing its operations following several profit warnings, and previously shelving plans to build a new factory in Sheffield.
McPhy also finalized an eight-year maintenance contract with Siemens Energy in 2022.
McPhy said 2022 marked a return to sustained sales growth, with revenue up 22% to Eur16 million, reflecting the materialization of first orders under “major” contracts in recent years.
Losses are anticipated at Eur34 million to Eur37 million, as the company invests and scales up.
— James Burgess
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