ArcelorMittal plans to end primary steelmaking at its Duisburg site in Germany by the end of 2027, closing its steelworks and billet mill and shifting to a rerolling model amid mounting economic pressures.
The company announced on Monday, September 1, that the decision followed an assessment of “several options” to maintain steel production following the end of its pig iron supply contract in September 2027.
Its contract with thyssenkrupp Steel was terminated in December 2024 because extending it would have resulted in “significant cost increases,” ArcelorMittal said. Alongside alternative pig iron supply arrangements, the company considered switching to electric-arc furnace-based steelmaking as part of its decarbonization strategy, but concluded that neither option was economically viable.
“While the structural challenges facing the steel sector in Europe are significant and well known – including low capacity utilization, declining local demand, limited export opportunities, and high energy costs – securing the long-term future of ArcelorMittal Duisburg for our customers, our employees, and the entire region is an absolute priority,” said Sanjay Samaddar, chief executive of ArcelorMittal Europe – Long Products.
The plan is for the company to rely on externally supplied billet, Fastmarkets learned.
“Several ArcelorMittal sites, as well as other external manufacturers in Europe, are capable of supplying Duisburg with the majority of the required semi-finished products,” a spokesperson said. “ArcelorMittal Hamburg, which produces steel using the DRI-EAF [direct-reduced iron-electric-arc furnace] process, is well-positioned to supply Duisburg with semi-finished products that have a lower CO2 footprint.”
The Duisburg plant currently has crude steel production capacity of 1 million tonnes per year and supplies customers in the automotive, mechanical engineering and railway sectors. ArcelorMittal did not specify the volume of wire rod it expects to produce after steelmaking ends.
“We are pressing ahead with our plans to supply the wire rod mill to ensure continuity of supply for all our customers beyond September 2027,” Samaddar added.
Management has begun discussions with the site’s 800 employees, with around 550 jobs reportedly at risk. ArcelorMittal did not say when its board would vote on the proposal or when employee consultations were expected to conclude.
Duisburg decision highlights mounting pressure on European steelmaking
A study published by PricewaterhouseCoopers (PwC) in August said the transformation of Europe’s steel sector was stalling and projected that conventional blast-furnace/basic oxygen-furnace steel (BF-BOF) steelmaking could become economically unviable in Europe and other regions by 2040.
The report said the deterioration in the route’s competitiveness would be driven mainly by rising carbon costs under the EU Emissions Trading System (ETS) and the Carbon Border Adjustment Mechanism (CBAM) affecting imports into the EU, which would “put an additional burden” on conventional steelmaking globally.
“The steel world of 2040 will be fundamentally different from today’s. The blast-furnace route will become uneconomical, the geography of primary production will shift, and the value of European steel processing will increasingly have to be measured by the knowledge contained in the product, not by the material itself,” Andree Simon Gerken, energy transition and decarbonization partner at PwC Germany, said on August 3.
The study identified scrap-based EAF steelmaking as Europe’s most resilient and competitive production route, noting that scrap is generated domestically and is not dependent on imported iron ore. However, PwC also noted that scrap-EAF cannot fully replace primary steel production because certain steel grades require specific raw material qualities, while also remaining sensitive to power costs and scrap availability.
In a bid to support industrial decarbonization, the European Commission proposed changes to the ETS in July, including extending free emissions allowances beyond 2030 for companies investing in low-carbon projects. Steelmakers said such measures are critical to support the transition to EAF-based steelmaking.
In June, voestalpine joined ArcelorMittal Europe and thyssenkrupp in calling for a pause in rising ETS costs, arguing that higher carbon costs risk diverting capital away from investments needed for the transition to low-carbon steelmaking.
The companies estimated then that, without reform, steel-intensive manufacturing activity in the EU could decline by 30-40%, putting as many as five million jobs at risk across the value chain. They called for a temporary pause in ETS cost escalation until conditions for economically viable decarbonization are in place, alongside stronger support for early-stage projects and measures to balance import and export competitiveness.
When asked whether ArcelorMittal’s recent decision could signal a broader risk of primary steelmaking capacity closures in Europe, a source said: “There is always a risk of a downturn. I don’t see that happening in Germany just yet, but who knows what will become of thyssenkrupp in the future.”
“ArcelorMittal has clearly put the brakes on decarbonization efforts in Germany. However, other blast-furnace operators such as Salzgitter and HKM are currently pursuing their decarbonization programs,” the source added.
Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Northern Europe, was €705-715 per tonne on September 2, unchanged week on week.
