Category: Latest Updates

The German construction boom saw a slowdown in May, but activity remained on a high level. Still, observers believe that the industry cannot remain immune very much longer from the downtrend in the overall economy.

In May, the latest statistics available, orders were up 8% year-on-year in nominal and 2.3% in real terms, according to association Hauptverband der Deutschen Bauindustrie. But the figures differed quite a bit depending on segment. While residential construction remained strong, public construction saw a dip in real terms.

The dip apparently kicked in only in May, as the period from January through May still saw orders up 6.2% in real terms. The order backlog in June was 4.3 months, Kallanish hears from the association.

“Due to the high order backlog, construction companies are still well utilised,” says association managing director Dieter Babiel. Be he cautions that the boom cannot defy the overall economy forever. “The increasing insecurities due to trade disputes and Brexit are toxic for the economy. Companies will be putting their investments on hold, and this will sooner or later filter through to the construction industry,” he says.

Sales of steel from stockpiles surged in July as destocking from inventories continued by members of the German trade association BDS AG, according to data from the group published Monday.

Sales from stockpiles in long steel products spiked in July, gaining 21.4% month on month to 324,113 mt. Flat steel sales increased 17.3% month on month to 573,485 mt, it said. In comparison to July 2018, long steel was 0.75% lower and flat steel fell 0.69%.

Destocking continued into July albeit at a reduced pace compared to June due to summer seasonality.

Flat steel stockpiles decreased 0.9% month on month to 1.48 million mt, the lowest level since January. They were still 6.4% lower compared to July 2018.

Long steel stockpiles declined to their lowest level since December 2018. Inventories fell 8,769 mt on the month, or 1.0% to 871,188 mt at the end of July, the data showed. They were still 4.54% lower compared to July 2018.

BDS members include ArcelorMittal Distribution, Jepsen Stahl GmbH and Klöckner & Co Deutschland GmbH.

— Len Griffin

Essen – thyssenkrupp Materials Servicessetzt seine Digitalisierungsoffensive fort: Ab sofort unterstützt eine flexible IT-Infrastruktur den Werkstoffhändler dabei, sämtliche Prozesse entlang der Wertschöpfungskette intelligent und agil zu steuern.

• „DESCA“schafft Datentransparenz über die gesamte Wertschöpfungskette
  
  
• Agile ERP-Plattform ermöglicht smarte Industrie-4.0-Anwendungen
  
  
• Einführung treibt strategische Weiterentwicklung „Materials as a Service“voran
  
  

Materiallieferungen, Kundenbestellungen, Auftragsbearbeitungen, Transportlogistik – der digitale Beschleuniger „DESCA“ kann Millionen von Datensätzen innerhalb von Sekunden verarbeiten und weiterleiten. Davon profitieren vor allem die Kunden: Mit DESCA verkürzt Materials Services die Durchlaufzeiten von Aufträgen, optimiert die Lagerlogistik und ebnet den Weg für neuartige Supply-Chain-Services. Damit macht das System seinem Namen alle Ehre: DESCA steht für „Digital Extended Supply Chain Accelerator“.

Treiber der strategischen Weiterentwicklung “Materials as a Service“

DESCA ist ein wichtiger Baustein in der strategischen Weiterentwicklung der Handelsparte. Mit dem Ansatz „Materials as a Service“ gewährleistet der größte Werkstoffhändler der westlichen Welt nicht nur den Zugang zu globalen Versorgungsmärkten, sondern gibt auch eigenes Prozesswissen in Form von maßgeschneiderten Supply-Chain-Lösungen an seine Kunden weiter. Damit setzt Materials Services neben dem Kerngeschäft des Werkstoffhandels konsequent auf den Ausbau des Dienstleistungsportfolios.

„Wir sehen großes Wachstumspotenzial in dem Bereich der Supply-Chain-Services“, so Klaus Keysberg, CEO von Materials Services. „Industrie-4.0-Umgebungen wie DESCA ermöglichen uns, die Komplexität in globalen Produktionsverbünden erheblich zu reduzieren. Hier setzen wir an und unterstützen unsere Kundendabei, sich ganz auf ihr Kerngeschäft zu fokussieren.“

Vorreiterrolle in der Luftfahrtindustrie

DESCA basiert auf SAP HANA. Im Vergleich zu herkömmlichen ERP-Systemen ermöglicht DESCA eine flexible Integration von Daten aus verschiedenen internen und externen Quellen. So lassen sich beispielsweise Auftragsinformationen mit den Bearbeitungsdaten aus dem vernetzten Maschinenpark abgleichen und künftig auch in Echtzeit abrufen, sogar per App. Das ist insbesondere für Branchen mit hohen Anforderungen an eine flexible Supply Chain interessant, so zum Beispiel für die Luftfahrtindustrie. Den ersten Praxiseinsatz absolvierte DESCA deswegen in ausgewählten thyssenkrupp Aerospace Niederlassungen in Nordamerika.

„Die smarte Vernetzung von Daten ist der Schlüssel zu mehr Effizienz und Kundenservice. Mithilfe unseres neuen ERP-Systems schaffen wir dafür die technologische Voraussetzung“, sagt Patrick Marous, CEO von thyssenkrupp Aerospace. „Wir nehmen hier eine Vorreiterrolle ein und stellen als einer der ersten großen Anwender in der Luftfahrtindustrie auf die neueste SAP-Umgebung um. Die erste Phase hat gezeigt, dass wir damit unsere Kernkompetenz, das smarte Supply-Chain-Management, entscheidend stärken.“ Visualisierungen zeigen relevante Daten auf einen Blick. „DESCA zeigt uns über ein Dashboard an, was wir in den nächsten Stunden zu tun haben und hilft uns dabei, unser Steuerungsmodell konsequent in die Zukunft auszurichten“, so Marous.

Motor der Digitalisierung

Im Rahmen der Digitalisierungsoffensive von Materials Services bildet DESCA den Motor: Denn die Daten, die nun aus allen Bereichen der Wertschöpfungskette im neuen ERP-System zusammenlaufen, sind das Futter für „alfred“, die Anfang 2019 eingeführte, selbstentwickelte Künstliche Intelligenz des Werkstoffhändlers. Zudem kommuniziert DESCA mit „toii“, der IIoT-Plattform des Unternehmens, über die sämtliche Anlagen weltweit miteinander vernetzt werden.


Über thyssenkrupp Materials Services:

thyssenkrupp Materials Services ist mit rund 480 Standorten – davon 271 Lagerstandorte – in mehr als 40 Ländern der größte Werkstoff-Händler und -Dienstleister in der westlichen Welt. Der Fokus von Materials Services erstreckt sich über zwei strategische Handlungsfelder: Den globalen Werkstoffhandel als one-stop-shop – von Stahl und Edelstahl, Rohren und NE-Metallen über Sonderwerkstoffe bis hin zu Kunst- und Rohstoffen – sowie das kundenindividuelle Dienstleistungsgeschäft in den Bereichen Materials Management und Supply-Chain-Management. Über eine umfassende Omnichannel-Architektur haben die 250.000 Kunden weltweit kanalübergreifenden Zugriff auf mehr als 150.000 Produkte und Services rund um die Uhr. Eine hoch performante Logistik sorgt dafür, dass sich alle gewünschten Leistungen, ob „just-in-time“ oder „just-in-sequence“, reibungslos in den Fertigungsprozess der Kunden eingliedern.

Quelle und Bilder: thyssenkrupp MaterialsServices GmbH  

Konsorcjum Stali (KS) reported a -6% on-year decline in revenue in the second quarter to PLN 425.3 million ($108m), while net profit plummeted -56% to PLN 2.5m, Kallanish notes.

In the first half of 2019 revenue was thus down -7% to PLN 851m and net profit plunged -79% to PLN 3.6m.

H1 steel product sales declined -5% on-year to 219,900 tonnes, while KS-produced or processed product sales fell dropped -4% to 111,500t. Rebar sales dropped -2% to 101,400t and sheet sales fell -12% to 36,500t, but Z and G sections sales were flat at 29,800t.

The price downtrend during H1 raised expectations among buyers of further reductions, which curtailed demand, KS says. The exact opposite was the case in the year-earlier period. Steel demand fell mainly due to slower EU economic growth and the high inventories amassed by buyers at the beginning of 2019, KS says.

Polish apparent steel consumption fell -10% on-year in January-May, with automotive and white goods most affected. The construction industry, however, continues to have stable consumption at elevated levels.

Celsa, CMC Poland and Riva Stahl were KS’s largest suppliers in H1, accounting for 22.8%, 20.3% and 11% respectively of the distributor’s material procurement.

Although European economic growth has slowed, Polish GDP is set to grow 4.4% on-year in 2019 and 3.6% in 2020 thanks to the relatively high level of investments, private consumption and strong construction activity, KS concludes.

Idled Polish plate producer ISD Huta Czestochowa has received a takeover offer from Warsaw-based Sunningwell International Polska, a representative of the bidder told S&P Global Platts Friday.

“It’s true that the Sunningwell company made an offer to ISD Huta Czestochowa. We will be able to tell you more after they accept our offer,” the representative, Agnieszka Leszczynska, said.

On its website, Sunningwell describes itself as the Polish platform “for financing trade, financing the purchasing of goods, raw materials and semi-products by companies from Poland on foreign markets.” The company boasts that it is well linked with Asian markets, but it is unknown in the steel industry.

According a trade union representative at Huta Czestochowa, a court supervisor and creditors are evaluating the offer and should decide in the next few days whether to accept it.

Huta Czestochowa is under pressure to find a new investor quickly to avoid insolvency. A source close to the mill said that in order to ensure the steel mill’s continued operations, it needs to find an investor. In the event of insolvency, the mill would confront being auctioned piece by piece, while its workforce of 1,200 would face dismissal.

Another prospective investor, global company Liberty Steel, is said to still be interested in buying Huta Czestochowa, but according to a source at Liberty, it needs more time to figure out how the Polish mill would fit into Liberty’s business model.

The trade unionist noted that the mill “cannot lose any more time” as production has been idled for four months and workers have been on 60% of their salaries. If the offer from Sunningwell is accepted, Czestochowa can look at a production restart in about a month, the unionist added.

An Eastern Europe-based industry source told Platts that “the deal — if it happens or not — depends on whether the creditor-banks will take [Sunningwell], without any reputation in the steel sector, and its offer, at face value.”

“The cost of the transaction will play a role, too. As far as I know, the banks wanted to get $56 million,” he said, but so far they have not found an investor willing to pay that much. He added that a real change is only possible if Huta Czestochowa goes to a company with expertise in the steel industry that has the technical resources to carry out the mill’s renovation.

“If it continues under the current management, the takeover makes no sense,” he said.

— Wojtek Laskowski, Katya Bouckley

Rumour has it that thyssenkrupp and Klöckner & Co have been in closer talks than either side would admit so far. Last Friday Handelsblatt reported that talks are “…tangible,” citing unnamed sources from inside thyssenkrupp.

The proposal that thyssenkrupp’s Materials Services division and Klöckner & Co could be interested in one another came up in the course of the unsuccessful merger with Tata. That merger would have been a solution for thyssenkrupp’s steelmaking activities and stirred up speculation that the firm is also searching for a partner for its distribution business.

The merger came off the table in June, blocked by a veto from the European Commission. But the fantasy of a thyssen-Klöckner approximation remained, this time under thyssen’s newly-formulated strategy of sticking to steel and strengthening production as well as distribution.

Only a couple of weeks ago, Klöckner ceo Gisbert Rühl told Kallanish that the consideration of taking a major stake in tk Materials Services essentially expired after the Tata merger failed. He did not exclude, however, that Klöckner remained open for some form of cooperation, but didn’t seek it actively.

According to Handelsblatt, the idea this time works the other way around, with thyssenkrupp pondering a takeover of Klöckner. This would arguably create the biggest steel distributor in the western world. Both groups when contacted about the reports were unusually very quick with returning calls and stating that they would not comment.

Thyssenkrupp will file a complaint against the European Commission’s decision to prohibit the formation of a European flat steel joint venture with Tata Steel. The complaint will be submitted to the General Court of the European Union (EGC), the group said Thursday.

The Commission had found that a joint venture between thyssenkrupp and Tata Steel would restrict competition in Europe, for certain steels and to such an extent that price increases could be expected. While Tata and thyssenkrupp had offered divestments of activities to alleviate such concerns, the Commission found that the remedies were insufficient.

Thyssenkrupp states that it does not share the argumentation of the Commission regarding the assessment of the product groups of packaging steel and hot-dip galvanized steel for the automotive industry. The Commission has for the first time set out a restrictive market definition that unduly extends the scope of the existing competition law, tk says.

Furthermore, the Commission did not take adequate account of the structural importance of imports into Europe. Nor did it consider buyer-side purchasing power and possible substitutions with alternative packaging materials and alternative galvanizing methods, tk says.

“The consolidation of the European steel industry is still right and necessary, which is also shown by the current critical market situation for steel manufacturers,” says Donatus Kaufmann, member of thyssenkrupp’s executive board. “We regret the European Commission’s decision and regard it as too far-reaching and wrong. That is why we are filing a complaint,” he says.

Fagor Arrasate has supplied German steel service centre Flachstahl Werl with its third slitting line with coil banding, Kallanish learns from the supplier company.

The new equipment provides the user with the most demanding standards of surface quality, and allows for working with delicate materials of thicknesses from 0.3-6mm, Fagor Arrasate claims. It allows Flachstahl Werl to process and cut material at high rates and with the quality required for the automotive industry, thanks to its different tensioning systems, Fagor notes. Specifically, it incorporates a system of belt bridle and a tensioner with felt pads for different types of steel.

Jon Zubillaga, Fagor Arrasate’s sales manager for Central Europe, claims that “…with this new slitting line, Flachstahl Werl becomes the absolute market leader in Germany.” The new line will benefit from Fagor Arrasate’s new after-sales service plant in Hilpoltstein, Germany.

The European Commission’s proposed revisions on the global HRC safeguard quota could hit Turkish mills’ HRC exports to the region significantly, especially next year, as Turkey is one of the main countries benefiting from the quota.

According to the EC’s revision plan, any one country can alone supply up to a maximum of 30% of the overall EU HRC imports from now on. This revision is expected to come into effect on October 1, after approval by the EU member countries.

If this revision will come into effect, it may pull down Turkish mills’ HRC exports to that region by as much as around 800,000-1 million mt in 2020, according to some analysts.

Turkey, which has been a net importer of hot-rolled coils, became a net exporter in 2018, as the country’s HRC export volumes exceeded HRC import volumes last year, with the support of strong demand from EU countries, despite the closed doors of the US market, as reported.

Turkish mills’ exported 3.91 million mt of HRC to global markets throughout 2018, while around 3 million mt of it was shipped to EU countries, according to Turkish Statistical Institute (TUIK) data sent to S&P Global Platts.

This trend continued in the first quarter of 2019, as Turkish mills’ HRC shipments to the EU region totaled around 800,000 mt — about 70% of Turkey’s total HRC shipments in Q1.

But, after maintaining its new net HRC exporter position in Q1, achieved in 2018, total Turkish HRC import volumes exceeded export volumes again for the first half, as trade flow reversed in the second quarter.

European producers’ HRC exports to Turkey totaled around 600,000 mt in the second quarter, an increase of 96% from Q2 2018, while Turkish mills exports to the EU region fell gradually month on month, amid trade barriers, stiff competition and Turkish mills’ increased input costs.

As demand from the EU has slowed and domestic demand remained sluggish, some downward adjustments also have begun to be seen in Turkish mills’ HRC prices. Some Turkish mills’ HRC offers for large-tonnage bookings fell as low as $485-$490/mt FOB, one trade source said, while a producer source said buyers have been absent over the last 10 days (see related article).

“We are under enormous pressure from EU producers offering awful low prices to Turkey. The second quarter, Turkey has dropped its export to EU by about 50%, but in return, EU has exported its export to Turkey double of what they did in the first quarter. They are today shipping more HRC to Turkey than Turkey ships to EU,” an executive of a major Turkish HRC producer told Platts.

“Turkey is a single country. However, EU is a union of 28 countries. Our share on their total consumption is around 4-5%, while their share in our consumption is 20%, meaning their impact in our market is five times greater than our impact on their market.”

The producer source said the latest decision “specifically targeted Turkey.”

“We couldn’t mention about a global HRC quota from now on. Implicitly, it becomes a country-based quota,” the source said. “They also have reduced the planned increase in tariff-free steel quotas to 3% from 5% across all product categories, which means that they are changing the rules in the middle of the game, which couldn’t be acceptable. My expectation is our Trade Ministry will respond to their move under the rule of reciprocity.”

The Turkish Trade Ministry, which launched a steel safeguard investigation on steel imports a year ago, ended the investigation at the beginning of May without taking any action, as reported.

— Cenk Can

The northwest European hot-rolled coil (HRC) market continued to slip today, with some domestic sellers keen to move tonnes because of sluggish demand and a drop in orders from their own service centres.

Argus‘ daily northwest Europe HRC index fell by €2.50/t to €464.50/t ex-works, its lowest since launching on 12 November last year. The daily Italian index was unchanged at €443/t ex-works. The northwest forward curve nudged lower, with the front month slipping to €467.75/t. September dropped by €1/t to €463/t, while October nudged €0.50/t lower to €463.50/t.

Service centre procurement executives that were working had no desire to go long, given the uncertain price outlook and seemingly intensifying trade war, with China retaliating against the latest US tariffs.

End buyers were still cautious and ordering their minimum requirements, which was reflected in service centres’ approach to hot-rolled procurement. One Benelux-based stockholder said this week was worryingly quiet and that he had postponed planned purchases as a result. He also anticipated further declines, given lower prices globally.

Third-country HRC was offered at €465/t cif Antwerp, but this was not attractive enough to entice buyers. Price pressure stemmed more from domestic mills than their foreign competitors, although weakening prices elsewhere did impact sentiment somewhat.

Traders were having some success with Indian cold-rolled coil (CRC), which was offered at €525/t cfr Antwerp for November delivery. There was some concern about India’s recent competitiveness — it has been dominant in Vietnam and offering aggressively into Turkey — and whether this was a blip caused by the monsoon season or structural oversupply relative to demand.

A Turkish mill cut its HRC export offer to around $480/t fob and was widely expected to drop lower given slack demand.

There was increasing concern over the creditworthiness of some automotive sub-suppliers given the protracted weakness in the global sector. Sub-suppliers in Germany have announced restructurings and profit warnings, and a Belgium-based sub-supplier issued a notice today about temporary layoffs in response to local press reports. If automotive remains weak over the rest of this year, it could continue to impact sub-suppliers.