Competitive energy, green market remain decarbonisation bottlenecks: Eurofer

EU policymakers still need to provide supply of internationally competitively priced low-carbon energy, establish lead-markets for European green steel, and introduce measures to address massive excess capacity in the global steel market, says Eurofer.

Although the EU has launched a number of initiatives in recent years to support decarbonisation, these issues remain “the real bottlenecks”, Eurofer director general Axel Eggert says in a note sent to Kallanish.

Eurofer delivered this message during this week’s Clean Transition Dialogue on Steel in the presence of the executive vice presidents of the European Commission, Maroš Šefčovič and Margrethe Vestager.

2023 saw the lowest European crude steel production levels ever, with a number of idled plants and dire impact on workers, the association says. The short-term viability of European steel sector decarbonisation must be top of the EU agenda, it adds.

“European economic integration was built with steel, the backbone of Europe’s manufacturing value chains. We firmly believe that also the future of Europe and its cleantech sector can only be forged with European green steel. This EU Dialogue is the first significant initiative going in this direction, and we hope that it will be continued and followed by concrete steps,” Eggert says.

The European steel sector is the frontrunner in decarbonisation at a global level, with about 60 low-carbon projects out of 80 planned worldwide. However, capital investment requirement amounts to €31 billion and operational expenditures to €54 billion, totalling €85 billion ($92 billion).

However, the EU steel industry’s leadership in the race to net-zero is jeopardised by energy prices that are 4-6 times higher than competitor regions, and a global non-market excess capacity of 600 million tonnes, with 150mt more planned in the next three years. Further hurdles are government subsidies, unfair trade practices distorting the international playing field, and uneven climate ambition between regions, Eurofer says.

It advocates streamlining across all policy areas a joint green industrial policy that spurs investments, including by creating lead markets for European green steel; promoting access to affordable fossil-free energy; and enforcing a robust trade policy based on reciprocity against unfair practices. Also important are to secure access to critical raw materials, including scrap, for the transition, and provide adequate training and academic opportunities for young talent.

Adam Smith Poland

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Salzgitter talks to Vallourec about HKM stake

The two German stakeholders of Hüttenwerke Krupp-Mannesmann (HKM) – thyssenkrupp Steel and Salzgitter – are negotiating with the third owner, Vallourec, about a transfer of its stake in the big mill in Duisburg.

While Salzgitter’s 30% stake is smaller than thyssenkrupp Steel’s 50%, it could be more serious about taking Vallourec’s 20% shareholding because of its similar activities in tubes. France-based Vallourec shut all its plants in Germany last year and it makes little sense to keep its stake in HKM. A plan to sell the stake has not yet been made official but Salzgitter’s executives expect it will come, they said during a conference call.

“Vallourec is basically out of HKM, and we are talking to them, as we stand behind HKM,” Kallanish heard Salzgitter chief executive Gunnar Groebler say. He noted, however, that thyssenkrupp Steel is the main stakeholder with the main say on the future of HKM.

For its own tubes activities, Salzgitter is more optimistic for large line pipe than for precision pipe. The latter “are mostly for automotive, which was weak in 2023, and remains challenging in 2024, meaning we need to keep an eye on costs,” Groebler said. For large-diameter pipe used in pipelines, the company is banking on improving utilisation in the second half of the year. “There are many projects out there for which we have bid,” Groebler noted.

Tubes are part of Salzgitter’s Steel Processing unit, which also includes heavy plate. The unit’s order intake in 2023 was €2.22 billion ($2.4 billion) versus €2.75 billion in 2022. Shipments fell from 1.57 million tonnes to 1.46mt.

Christian Koehl Germany

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Low demand weighs on European steel beam prices

A lack of demand dragged down steel beam prices in Europe in the month to Wednesday March 20, with no improvement in activity or prices expected any time soon, sources told Fastmarkets.
Fastmarkets’ weekly price assessment for steel beams, domestic, delivered Northern Europe, was €700-770 ($761-837) per tonne on Wednesday, narrowing down by €60 per tonne from €760-770 per tonne on February 28.

Similarly, Fastmarkets’ weekly price assessment for steel beams, domestic, delivered Southern Europe, was €700-770 per tonne on Wednesday, narrowing down by €60 per tonne from €760-770 per tonne on February 28.

“Prices are under pressure because of low demand,” a trader in Northern Europe told Fastmarkets.

Sources were pessimistic about expectations for demand in the second quarter of the year, amid weak consumption in the construction sector.

Scrap feedstock costs in Turkey’s bellwether market declined over the month, meanwhile, due to weak economic conditions and slow trading during the Islamic holy month of Ramadan.

Fastmarkets’ daily index for steel scrap HMS 1&2 (80:20 mix) North Europe origin, cfr Turkey was calculated at $375.43 per tonne on Wednesday, down by $30.03 per tonne from $405.46 per tonne on February 20.

Published by: Holly Chant

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Market conditions unchanged in Northern European steel longs market

Market activity remained slow across the Northern European steel longs market during the week to Wednesday March 20 amid stable market conditions.
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Northern Europe was €645-655 ($701-712) per tonne on Wednesday, narrowing downward by €5 per tonne from €645-660 per tonne one week prior.

Depressed consumption resulted in a pessimistic outlook for the Northern European rebar market, sources said.

Decreasing scrap prices have resulted in further resistance among buyers to accepting higher prices.

Fastmarkets’ calculation of its daily index for steel scrap heavy melting scrap 1&2 (80:20 mix) North Europe origin, cfr Turkey was $375.43 per tonne on Wednesday, down from $377.51 per tonne week on week.

The corresponding Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Northern Europe was €645-660 per tonne on Wednesday, stable week on week.

Meanwhile, import offers were reported in the Netherlands from Algeria at €590 per tonne cfr. The majority of import offers were reported at around €630 per tonne cfr.

Published by: India-Inés Levy

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Trading muted in oversupplied European steel HRC market

European buyers of steel hot-rolled coil were still postponing any restocking amid downbeat price expectations, slow demand and a lack of clarity concerning EU-mandated import quotas for the second quarter, Fastmarkets heard on Thursday March 21.
Trading has been subdued in the European HRC markets since early February. Buyers were only booking small tonnages to cover urgent needs, expecting domestic prices to slip downward in the short run.

Besides, buyers said, they wanted to see how many tonnes of imported coil would be customs-cleared on April 1 under the EU’s safeguard quotas, and what duty rates would be applied.

“We are buying as little [HRC] as we can and waiting for more clarity on import volumes for the second quarter,” a buyer in Germany said.

Market sources expected import quotas for India, South Korea and the “other countries” category – which includes Japan, Taiwan, Vietnam and Egypt – to be exceeded for the second quarter, Fastmarkets heard.

In any case, end-user demand for HRC has remained sluggish, with buyers preferring to keep their stocks low.

“Real demand is very weak,” a second trader said, “because most buyers have sufficient stocks, [and are] dealing with lower demand and strong competition between steel service centers, stockists and traders downstream. [They are also] expecting even lower [HRC] prices because of declining costs for raw materials.”

Offer prices in Northern Europe were reported at €700-710 ($761-772) per tonne ex-works, although market sources said that €680-690 per tonne ex-works would be “negotiable” on a firm bid.

Buyers’ estimates of achievable price for HRC were heard at €670-680 per tonne ex-works.

“Mills are hungry for orders, but at the same time [they are] not prepared to give in to the extremely low prices for now,” a trader in the Benelux area said.

In the Benelux countries, an offer from a re-roller was heard at €660 per tonne delivered.

Producers in the region could mainly offer May lead times.

As a result, Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe at €680.63 ($739.93) per tonne on Thursday, down by €2.70 per tonne day on day from €683.33 per tonne.

The index was down by €14.70 per tonne week on week and by €42.50 per tonne month on month.

In Southern Europe, Fastmarkets calculated its corresponding steel HRC index, domestic, exw Italy at €663.50 per tonne on Thursday, down by €1.50 per tonne day on day from €665.00 per tonne.

The index was down by €10.25 per tonne week on week and by €58.44 per tonne month on month.

HRC offers in Italy were mainly heard at €680-690 per tonne delivered, equivalent to €670-680 per tonne ex-works, although some industry sources said that €670 per tonne delivered (€660 per tonne ex-works) was achievable on larger volumes.

Lead times were around six weeks from a local supplier, market sources said.

In the secondary market, 4mm HR sheet was heard traded at prices no higher than €750-770 per tonne CPT, with some steel service centers reported to be offering as low as €740 per tonne CPT. Downstream sales were reported to be very slow.

Offers from Vietnam, South Korea and Taiwan were generally around €580-600 per tonne CFR, but buying interest has remained low, Fastmarkets understands.

Most Asian suppliers were heard offering HRC for shipment in late May, which would mean June-July arrival.

An offer from Saudi Arabia was reported at €570 per tonne CFR for May shipment.

From Turkey, an offer of June-arrival coil was heard at €620 per tonne CFR, including duties.

Published by: Julia Bolotova

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Ukraine’s galvanized steel consumption reaches pre-war levels: Metinvest

Ukrainian galvanized rolled steel consumption increased last year by 41% on-year to 243,000 tonnes, says Metinvest SMC director of sales for metalworking Denys Yarko. In 2022, the figure was 172,000t.

“The main drivers for growth were the increase in demand in the civil construction segment and among end consumers, as well as the stabilisation of the electricity supply situation since the second quarter of last year,” he said at a government meeting this week. “About a third of the total consumption, 32.6%, was Ukrainian-made, with 79,000t of galvanized product going to the domestic market.”

Two thirds of the market is occupied by imported products, Kallanish notes. Of the 164,000t of imported galvanized steel consumed in Ukraine last year, the majority came from Turkey – 116,800t – doubling versus 2022.

In 2023, a significant volume of galvanized steel was also imported by Ukraine from Poland (13,600t), Slovakia (12,700t) and Romania (8,700t).

Metinvest SMC predicts further growth in consumption of galvanized steel in Ukraine. In 2024, the company expects the domestic market to increase by 19% on-year to 289,000t.

Ukrainian steel companies decreased production in February compared with the previous month to 531,900t, down by 2.2% from January, but this was up 25.5% year-on-year (see Kallanish passim). Output of pig iron decreased by 10.6% month-on-month to 495,700t, but was up 40.2% on-year. Rolled products output was 1.3% less on-month, but 35% more on-year at 447,200t.

In January-February, production of steel increased by 52% on-year to 1.08 million tonnes and pig iron by 42.4% to 1.05mt. Rolled products output surged by 52.9% to 900,200t.

Svetoslav Abrossimov Bulgaria

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Salzgitter orders pickling section from Andritz

Technology group Andritz has received an order from Salzgitter Flachstahl to supply a new pickling section for the existing push pickling line designed for heavy-duty steel grades.

The line was supplied to the German steelmaker by Andritz in 1992, Kallanish understands. New process equipment will ensure continued reliable operation and increase the line’s efficiency, the Austrian equipment supplier says.

The scope of supply comprises Andritz proprietary high-end process technology for push pickling, it says. This includes a circulation system, high turbulence hydrochloric acid pickling, a compact rinsing and drying section, plus a state-of-the-art trimming shear. The new process equipment will improve strip threading through the pickling section and increase pickling efficiency, Andritz says.

Start-up is scheduled for mid-2025.

Christian Koehl Germany

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Outokumpu secures land, considers nuclear reactor

The Finnish city of Tornio and Outokumpu have signed a pre-agreement regarding Outokumpu’s acquisition of 96 hectares of land in the Koivuluoto area next to Outokumpu’s Tornio operations. The steelmaker may use this to build a small modular nuclear (SMR) reactor, Kallanish notes.

The plan is to use the land area for industrial purposes by Outokumpu and its partners, which Outokumpu says enables it to create a vibrant ecosystem for a circular economy. As possible options for land use, it gives production of hydrogen, chemicals, synthetic fuels, or electricity needed for various industries. For electricity production, Outokumpu is currently reviewing a plan to build an SMR reactor in the Koivuluoto area.

“Outokumpu invests heavily in its sustainability strategy and the target is to reduce carbon dioxide emissions by 42% by 2030 compared to the 2016 baseline. Land acquisition is one of the corner stones in Outokumpu’s roadmap to enable the achievement of these targets,” says Tony Lindström, general manager of Outokumpu EvoEnergy.

Christian Koehl Germany

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ArcelorMittal France new CCUS technology tests advance successfully

The so-called 3D Project, using a DMX technology demonstration plant for CO2 capture installed at ArcelorMittal’s Dunkirk plant, is operating stably and to expected efficiency and energy performance levels, says engineering company Axens, which commercialised DMX.

The pilot line capturing the CO2 in blast furnace gases has been the object of round-the-clock tests. The unit is producing CO2 with a high level of purity exceeding 90%, with low energy consumption and no solvent degradation despite the high concentrations of contaminants in the gas treated, Axens says.

The technology, patented by research company IFP Energies nouvelles (IFPEN), has taken 15 years of development, Kallanish notes. The steelmaker and Axens launched the 3D project in 2019. Coordinated by IFPEN, the French DMX technology is the result of a research project including ArcelorMittal, Axens, TotalEnergies, Air Products, Brevik Engineering, John Cockerill, DTU, Gassco, ETHZ and Uetikon.

It uses an amine demixing solvent to capture CO2 contained in the flue gases produced by heavy industries. Capture will be necessary in order to reduce industrial emissions. “The significant reduction in the energy required for the process and the excellent stability of the solvent make the DMX process a unique, innovative, efficient and flexible solution,” Axens says.

The DMX technology is seen accelerating French industry decarbonisation using a carbon capture utilisation storage strategy.

Natalia Capra France

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SSAB upgrades CR mill in Finland

SSAB has tasked Primetals with the next stage of upgrading stand No.1 at SSAB’s four-stand tandem cold rolling mill in Hämeenlinna, Finland.

One year ago, Primetals implemented mill stand drives for the stand No.1, During phases 1 and 2, it upgraded the drive system, including transformers, drive, and motor. In phases 3 and 4, the transformers, drives, and motors of the remaining mill stands will be modernised in a similar way to phases 1 and 2, Kallanish learns from the technology supplier.

In phase 5, an obsolete motor will be refurbished, allowing it to be used as a replacement for the other already modernised motors. The objective of the extensive upgrade is to secure the supply of spare parts for the mill stand drives well into the future. Moreover, the availability of the tandem cold rolling mill will be increased, Primetals explains.

The four-stand tandem cold rolling mill produces coil ranging from 660-1,575mm wide and 0.35-3.1mm thick. The mill, among other things, makes ultra high-strength steel products, mainly for the automotive industry, which provide greater impact protection in cars while reducing weight.

As SSAB is transforming its mills in Luleå and Raahe into mini-mills with electric arc furnaces, Hämeenlinna will be further developed in line with the new production processes, SSAB says in its latest annual report.

Christian Koehl Germany

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