Category: Latest Updates

Salzgitter is currently going through a difficult spell, little helped by its relatively high profits in 2017 and 2018. However, “… we have seen worse and survived it,” its ceo Heinz Jörg Fuhrmann says in an interview with FAZ.

As with other European steel groups, Salzgitter saw all key figures fall in the first half of 2019, but maintained some profit in all of its operations, Kallanish notes. The order intake at the Strip Steel unit generated revenues that fell from €1.63 billion ($1.82 billion) to €1.57 billion, and a pre-tax profit that fell from €110 million to €60m. The lower performance compared with the outstanding earlier result is largely due to higher raw material prices and the downturn in the selling prices of strip steel products, the company says.

Volumes in the Plate/Section unit fell significantly below the level posted in H1 2018, due in particular to lower volumes. Orders in the segment dipped from 1.17 million tonnes to 1.04mt, and revenues from €954m to €887m. Salzgitter notes that a higher pre-tax profit from its sections activities at Peiner Träger compensated for a negative result of the heavy plate mills, and came to €0.6m, after €22m a year earlier.

At Mannesmann tubes unit, shipments remained virtually unchanged, while external revenue rose on the back of selling prices from €563m to €582m. Pre-tax profit was €9m, after €12m in H1 2018.

In the Trading unit, shipments dropped from 2.25mt to 2.09mt due to the downturn in international trading volumes, whereas sales by the stockholding segment remained stable. External revenues settled around the previous year’s level at €1.58 billion, and generated a pre-tax profit of €4m, which is notably lower than the €25m achieved in the corresponding period in 2018.

The European Commission has surprised market participants by maintaining a global quota for hot-rolled coil in its safeguard review.

The commission said the share for any exporting country in any given quarter will be capped at 30pc of the total. The volume for 1 July 2019 to 30 June 2020 will be lowered marginally to 8.47mn t from 8.64mn t previously, and the measure will come into force on 1 October this year.

The commission factored in more recent imports in its safeguard review, and has reduced its relaxation for all products from 5pc to 3pc across all product categories, noting last year was a record for shipments to the EU. The commission also said Turkey, India and Serbia have been replacing imports from countries with anti-dumping and countervailing duties, and that Russia has recovered a “substantial part of its historical trading volume” despite the duties in place.

The 3pc means quotas for the remaining period from 1 October 2019 will be revised down to ensure the total increase in the allowance is 3pc over the year.

Argus Media

The European Commission has initiated an anti-dumping investigation into stainless hot rolled sheet from China, Taiwan and Indonesia, Kallanish learns from a statement.

The investigation follows a complaint by Eurofer lodged at the end of June. “The complainant has provided evidence that imports of the product under investigation from the countries concerned have increased overall in absolute terms and have increased in terms of market share,” the Commission statement explains.

In recent months Eurofer also openly asked the European Commission to include Indonesian stainless steel in the safeguard measures, a request opposed fiercely by major Italian processor Marcegaglia. A decision in favour of AD duties on stainless HRC sheets could well be enough to stop the trade with Europe even if the country is not included in safeguard measures.

The European Commission also adds that in the Eurofer request there is evidence that raw material input costs in China and Indonesia are distorted due, for example, to export restrictions on nickel and chromium in the countries.

The products under investigation fall under HS codes 721911, 721912, 721913, 721914, 721922, 721923, 721924, 722011 and 722012. Products, not in coils, of a width of 600mm or more and of a thickness exceeding 10mm are excluded from the investigation.

In the first five weeks of the new European Commission definitive steel safeguard year, importers of hot-rolled coil have seen approximately 724,000 mt of the three-month global quota of 2.172 million mt cleared into free circulation.

As of the Aug 7 import date, a further 9,755 mt of HRC awaits allocation, according to the latest information available from EC website. 

Large balances remain in each of the other main flat steel product categories, with cold-rolled coils collectively showing 88.5%, or 1.62 million mt of the net 1.83 million mt quota remaining available for import. 

For galvanized coils, category 4a — non-automotive grade coated coils — 87% of the collective quota allowance remains available. Product category 4b — coated material mainly used in automotive applications — has seen the largest volume of imports, with the China country quota being used up fully on July 1, as previously reported by Platts.

The net remaining 4b material now shows 54% still available under the original 1.681 million quota.

— Len Griffin

The Eurasian Economic Union’s (EEU) department for internal market defence has finalised its proposal to implement import quotas on various hot rolled flat products. This comes one year after it started a safeguard investigation.

An import quota of 1.33 million tonnes will be enforced for one year starting on 1 December, with imports beyond the quota subject to a 20% import duty. Imports arriving prior to December will be subject to an import procedure determined by the commission, it says in a note seen by Kallanish.

The investigation was initiated after Russian steelmakers MMK, NLMK and Severstal petitioned citing rising import volumes into the EEU as global overcapacity bred rising protectionism globally. It was originally determined that any import quota for imports of hot rolled steel products should not exceed 996,596t per year, but the final quota did so by a third.

The EEU commission notes the measure will not be applicable to countries falling under the Generalised System of Preferences, except for South Korea. Nor will it apply to CIS free trade agreement countries, except for Ukraine.

thyssenkrupp has identified three areas of commercial activity which, despite intensive efforts to improve, it says are currently not competitive and which it has placed under review.

From its steelmaking segment this concerns the production of heavy plate. Two other areas within the rest of the group, both linked to automotive applications are also being studied.

The three businesses represent only 4% of the group’s sales, but one quarter of the negative cash flow expected in the current fiscal year, tk says. “We will assess the potential of the three businesses. We definitely see opportunities for their further development, but not necessarily under the umbrella of thyssenkrupp,” ceo Guido Kerkhoff says.

Kallanish had earlier heard criticism from sources at thyssenkrupp’s works council that since the 1990s, the company had missed out on investments to modernise its plate production facilities. A tk Steel spokesman denied this, citing investments made in recent years.

In the first nine months of the fiscal year that began on 1 October, tk Steel Europe took orders amounting to 7.5 million tonnes, significantly less than the 8.3mt in the corresponding previous period. It attributes the fall to restricted booking possibilities in the first quarter. This was primarily due to low Rhine water levels, to slowing market momentum overall in subsequent quarters, and in particular a sharp drop in demand from automotive industry.

The segment’s order value remained basically stable at €7.0 billion ($7.8 billion), as higher average prices year-on-year partly offset the volume decrease. The company notes that “… a negative price trend in the spot market had also had a delayed impact on some of our longer-term contracts in the reporting quarter. This, plus significantly higher raw material costs, especially for iron ore, led to a fall in earnings to €77 million from €586m a year earlier at tk Steel Europe.”

The Italian government has approved a new decree this week including some specific laws related to the future of the Taranto plant of ArcelorMittal Italia, the former Ilva. Market sources hope the new legislation will be enough to convince ArcelorMittal Italia to continue operating despite the group’s earlier threats to abandon the facility on 6 September. The steelmaker has still not officially commented, however.

The Italian minister for economic development, Luigi Di Maio, explained that the new laws tie the legal safeguards for ArcelorMittal to the planned achievements of the environmental plan for the mill. He added that ArcelorMittal will be able to operate, but will be forced to meet the deadlines. Other observers suggest conversely that the latest law confirms the existing degree of protection for ArcelorMittal from the previous legislation, despite earlier threats made by the Italian government to remove the legal safeguard completely.

While ArcelorMittal is believed to be studying the documents before issuing a comment, sources close to the situation note that the Italian authorities appear committed to ensuring that the plant remains operational, Kallanish understands.

At the end of June ArcelorMittal specifically explained that it would relinquish control of the former Ilva plant if the legal safeguards for the company were removed by the Italian authorities.

Since that time, many in the European flat products market have been monitoring ArcelorMittal Italia as the mill reduced output and its future remained uncertain. Sources in Spain, for example, note that ArcelorMittal has been waiting to understand what steel output from Italy would be after the summer, before implementing planned production cuts at its Spanish plants.

The annual quotas for the import of Turkish rebar into the European Union have been filled by nearly 80% in just one month, Kallanish learns from the European Commission official database.

At the beginning of July the new quotas became available for importers, amounting to over 300,000 tonnes for Turkish rebar. This week the available quotas are only 65,000t and this volume could be used quickly in September as soon as the European markets ramp up again after the summer break.

Once the quotas are finished, Turkish rebar suppliers will have to wait until the second quarter of 2020 to sell rebar into Europe, using the residual ‘Other countries’ quotas.

Meanwhile for rebar importers into the EU there is still are still enough quotas available for purchases from Russia, Ukraine, Moldova and other markets.

Die Veranstaltung wird von der EUROMETAL in enger Zusammenarbeit mit den beiden Schweizer Stahlvertriebsverbänden SSHV / ASCA und VSEMH organisiert. 

Das Forum beschäftigt sich mit allen Aspekten, Chancen, Herausforderungen und Risiken bei der Umsetzung der Digitalisierung und Industrie 4.0 in Stahlvertrieb und -handel. Mit hochrangigen Experten und Diskussionsteilnehmern aus dem Stahlvertrieb und der europäischen Digitalisierungsbranche besetzt, verspricht das Forum ein interessantes Event zu werden. Inhaltlich geht es u.a. um die Vernetzung und Optimierung von Geschäftsabläufen, die Stahlanarbeitung von Lang-, Flach- und Rohrstahl im Sinne von Industrie 4.0 sowie den 3D-Druck, die Robotisierung und die automatisierte Materialflusslogistik, die großen Einfluss auf die Lagerhaltung verspricht.

Quelle: EUROMETAL / Vorschaufoto: marketSTEEL

While Riva’s mill in Brandenburg has now agreed to adopt to the German collective wage agreement, its two processing sites in western Germany in Trier and Horath are still gripped by a strike. They entered the third round of negotiations on Monday.

Rebar mill Brandenburger Elektro-Stahlwerke (BES) had until late July not implemented the wage increases agreed in the collective bargaining talks in eastern Germany in February. The mill faced three full-day strikes which, according to union IG Metall, caused a production loss of €6.6 million ($7.4m). The union was just about ready to launch a strike vote for a full-on strike when the agreement was reached in the last week of July.

“The management has finally given in,” the union says. According to spokesman Michael Ebener, BES was the only German mill in the wake of the collective wage talks early this year that kept refusing to adopt to the results of the talks. Notably, Riva’s other mill, HES in Hennigsdorf near Berlin, did adopt to the new wages without delay.

Meanwhile, the strike at Riva’s wire mesh manufacturing sites in Trier and Horath has been going on for eight weeks now, Ebener informed Kallanish during Monday’s negotiations in Frankfurt. He noted that workers from the sites had even travelled to Riva’s headquarters in Milan to protest.