Category: Latest Updates

The European Commission has lowered the definitive anti-dumping duty on imports of Ukrainian seamless pipe produced by Interpipe from 13.8% to 8.1% from 1 August, after an interim review. So says the official entry in the European journal.

The review was initiated in May 2018 by the commission after receiving a request from Interpipe, which claimed an indefinite significant change in supplier’s circumstances. This included a change in supply of feedstock source for pipe production from third party to in-house, after the integration of Dneprosteel in 2013. This was followed by a significant expansion of production range and decrease in exports of pipe under investigation.

The duties currently in force range from 24.1-35.8% for Russian and 12.3-25.7% for Ukrainian seamless pipe up to 406.4mm external diameter. Interpipe’s duty has been amended to 8.1% from 1 August, having been amended down from 25.1% to 17.7% and then down to 13.8% in 2012, Kallanish notes

The commission announced in October 2018 the completion of a full interim review which started in July 2017. The review lead to the definitive anti-dumping duty on Russian and Ukrainian round seamless pipe being kept in place, which then lead to the partial interim review on changed circumstance at Interpipe’s request.

UK Steel, the trade association for UK steelmakers and manufacturers, is urging the British government to secure tariff-free access to EU markets and more competitive electricity prices in the run-up to the UK’s exit from the EU.

This framework is necessary to ensure future investment by the steel industry and, potentially, the sector’s survival, the association warned.

The UK steel industry will no longer be protected by the EU steel imports safeguards system in the event of a no-deal Brexit. This could significantly raise costs and impede UK steelmakers’ ability to export to their natural market in the EU, unless tariff-free access is gained, UK Steel said in a paper sent to the new Secretary of State for Business, Energy and Industrial Strategy, Andrea Leadsom.

“Outside the EU, the UK would be subjected to the EU’s safeguard measures which apply 25% tariffs to all steel imports above specified quota levels,” UK Steel said in the paper.

It noted the cost of paying these tariffs once quotas are filled, which has occurred rapidly, would probably need to be borne by UK steelmakers.

“The UK government must therefore reach an agreement with the EU Commission to ensure tariff-free quotas in the event of a no-deal Brexit,” it said. “In the longer term it must be a negotiating objective during the transition period to ensure the UK and EU have the ability to exempt each other from safeguarding measures on the grounds of close economic integration, as is currently the case for Norway and Iceland.”

Increased costs
UK steel exports to the EU have recently run at 2.6 million mt/year, around a third of its total production. UK Steel estimates that regardless of what tariffs system might be adopted, the extra checks and administration of exporting to the EU after Brexit would increase costs by 4%-5% — an estimated GBP70 million ($84.9 million) cost to the industry each year.

The UK government must also take decisive action to align UK industrial electricity prices with those of the UK’s key competitors in France and Germany, UK Steel said in the paper, listing this as the second of six key demands it is making of government. It also requests changes or cooperation in the areas of business rates, public procurement policies, carbon costs and R&D.

“The UK’s electricity prices for large industrial energy users are higher than in any EU country,” the paper said. “In 2018/19 UK steel producers paid 51% more than German producers and 110% more than French producers, even after the compensation and exemption schemes already provided by the government. This amounts to a GBP55 million/year additional expense for the UK steel sector.”

— Diana Kinch

Jens Wegmann, der seit dem 1. Dezember 2017 dem Vorstand der Klöckner & Co SE angehört, scheidet zum 31. Juli 2019 im Einvernehmen mit der Gesellschaft aus der Klöckner & Co SE aus. Seine Aufgaben als COO werden in den USA von John Ganem und in Europa vom CEO der Gesellschaft, Gisbert Rühl, übernommen. Der Aufsichtsrat dankt Jens Wegmann für sein Engagement und wünscht ihm für die Zukunft alles Gute.

Dr. Oliver Falk übernimmt die Funktion des CFO, die übergangsweise vom Vorsitzenden des Vorstands, Gisbert Rühl bekleidet wurde.

Der Konzernvorstand von Klöckner & Co SE besteht somit zukünftig aus Gisbert Rühl, Vorsitzender des Vorstands und CEO Europa, Dr. Oliver Falk, CFO, sowie John Ganem, CEO Americas.

Dr. Oliver Falk ist bereits seit mehr als 25 Jahren erfolgreich in leitenden Positionen im Konzern tätig und aktuell CFO der Kloeckner Metals Europe GmbH. John Ganem leistet seit mehreren Jahren als CEO der US-Tochter Kloeckner Metals Corporation einen wesentlichen Beitrag zum Unternehmenserfolg in den USA.

Im Zuge der Neuaufstellung des Vorstands wurde eine weitere Dezentralisierung der Aktivitäten beschlossen. Mit diesem Schritt will das Unternehmen die unterschiedlichen Strukturen in den Ländern noch stärker organisatorisch berücksichtigen und so in den Konzerngesellschaften ein noch eigenständigeres und unternehmerisches Handeln fördern. Im Gegenzug führt dies zu einer Reduktion der Zuständigkeiten auf der Ebene der Konzernholding. Diese wird sich zukünftig auf Kernfunktionen sowie die Ausgestaltung und Steuerung der Digitalisierungsstrategie fokussieren.

Bildtexte Vorschaufoto: Dr. Oliver Falk / Beitragsfoto: John Ganem

Quelle: Klöckner & Co SE

Im Juni 2019 wurden weltweit von den 64 an die World Steel Association berichtenden Länder 159,0 Millionen Tonnen (Mt) Rohstahl erzeugt, was einem Anstieg von 4,6% gegenüber Juni 2018 entspricht.

In der ersten Jahreshälfte erzeugte Europa 84,7 Mio. t Rohstahl, was einem Rückgang von 2,5% entspricht. In Nordamerika legte die Produktion um 1,4% auf 60,1 Mio. t zu. Die GUS-Staaten produzierten konstant 50,5 Mio. t und in China legte man um 10% auf 87,5 Mio.t zu.

In der EU wurden produziert:

Deutschland: 3,4 Mio. t – 5,8%

Italien: 2,1 Mio. t – 2,5%

Frankreich: 1,3 Mio. t + 3,4%

Spanien: 1,2 Mio. t + 2,3%

Quelle: Worldsteel Association / Vorschaufoto: fotolia

Russian vertically-integrated steelmaker Severstal continues to expand its construction products’ range for European consumption with certification of high-strength reinforcing bar, the company says.

Rebar of 10mm-40mm diameter of grade B500B steel has been certified with accordance to German DIN 488:2009 standard, Kallanish notes. Severstal views the European construction industry as one of its high priority markets, implementing critical measures in final stages of production. These include measures enabling a thorough analysis of the finished product’s measurements and geometric qualities, Vadim Germanov, general director of Severstal Russian Steel is quoted as saying. 

The certification will allow Severstal to start supplying such products to the construction sector in the European Union, and other geographically-viable export locations. Severstal’s sales arm Distribution has ramped up sales to Northern, Central and Eastern Europe in the first half of 2019 by 9% on-year to 650,000 tonnes, Severstal says. Its Severstallat service centre in Latvia has considerably increased processing volumes, having reached an all-time sales record of 120,000t.

Meanwhile, Russian sales grew 25% year-on-year in the first half of 2019 to 550,000t, bringing total distribution sales to 1.3 million tonnes in H1 2019, 13% up on-year. Around 22% of the steelmaker’s finished products sales now pass through its distribution arm, the company notes.

German stainless tube maker Schoeller Werk has acquired AK Feinrohr, which specialises in the production of cold redrawn precision tubes, Kallanishlearns from Schoeller.

AK Feinrohr, based in Thuringia, is a manufacturer of welded and cold redrawn precision tubes and sections made of rust-resistant, acid-resistant and heat-resistant steels. It has been trading since 1982 and has 130 employees. Around 2,000 tonnes of stainless steel are processed every year, representing a turnover of €13.5 million ($15.0m) in 2018. 

In spring last year, Schoeller Werk, based in Hellenthal, close to Belgium, launched a programme for further expanding and safeguarding the company’s market position over the long term. “We are focusing on comprehensive measures for increased efficiency, together with a further development of our product range and the opening up of new target sectors,” says Schoeller’s managing director Frank Poschen. “One of the first measures to strengthen the group’s market position in its core sector of welded stainless steel tubes was the acquisition of AK Feinrohr.”

The newly-acquired firm will continue to operate under the name of Schoeller Feinrohr with Markus Zübert remaining as managing director. Schoeller Werke employs more than 1,000 people at its main site, but earlier this year announced that it would reduce personnel by 25% at the site to remain competitive. The site produces some 90 million metres of stainless tube each year.

Russian-headquartered steelmaker NLMK Group has signed a cooperation agreement with two major Russian steel trading and distribution companies, Metallservis and Steel Industrial Company, the company says.

The agreement will enable NLMK to pursue the traders’ highly developed and efficient customer service and logistics network in exchange of their use of NLMK’s newly relaunched on-line marketplace. The two traders’ aggregate sales totalled 4.3 million tonnes in 2018.

The agreement will allow the traders to gain access to NLMK’s marketing and IT expertise. NLMK meanwhile will receive an access to the network of warehouses and services, ensuring prompt delivery of their products, Ilya Guschin, NLMK sales executive said during the press conference call attended by Kallanish. NLMK’s potential hosting of competitors products on its platform will be mitigated by the much wider outreach that its products will have due to the cooperation, he added.

The agreement creates Russia’s largest shared network of over 70 warehouses and established logistics, which will eventually be selling up to 30,000 different products. The trading facility has been in operation since early 2018, but having moved it to the new IT platform, based on SAP, it has become much improved. It is able to accommodate new volumes of trading and customer service by enabling more options of delivery, communication and implementation.

NLMK has already doubled sales of its products through the platform in the first half of 2019 to 36,000 tonnes, while in May sales reached 120,000t in annualised terms, it says. Construction companies take up around two thirds of the clients, with traders and steel structures’ manufacturers and consumers taking up another third in roughly equal measures.

Germany’s Klöckner & Co will not attempt to make acquisitions beyond its defined home territory of certain European countries and the USA, according to its ceo Gisbert Rühl.

However, although the distribution group does not intend any physical expansion, it is gaining new territory through its e-commerce activities, he said during a conference call attended by Kallanish. Rühl has been strongly driving Klöckner’s digitalisation. The group’s sales via digital channels currently accounts for 29% of total sales, up from 20% one year ago, and is targeted to reach 33% by the end of the year.

For its open market platform Xom, it has just won Severstal as a major steelmaker. Xom currently has 35 suppliers “… which taken together stand for annual revenues of €35 billion ($39 billion). So if they handle 3% of their sales on average via Xom, the platform would have a revenue of over one billion euros,” he said. Currently, the annual transaction value is still only €10 million, but “… is growing explosively, after much campaigning that we have done lately,” he added. One year ago, the platform only had five suppliers participating.

Apart from Severstal in Russia, Klöckner’s e-commerce activities has led the company to Italy, and won back partners in Spain, which the company had exited years ago. In the USA, it is currently in talks with some 100 possible new participants.

Separately from the open platform Xom, Klöckner also operates the so-called ‘Klöckner Market Place’. This is open only to partners that do not compete with Klöckner’s products, often processors or suppliers of other materials than steel.

Klöckner is continuing to offer its digital services widely, and has just secured its first customer among Frankfurt Stock Exchange’s DAX 30 companies, Rühl said, without naming the company.

ArcelorMittal is negotiating with the Italian government for a solution to allow the continued operation of its ArcelorMittal Italia subsidiary from September 7, when a current legal safeguard for its operation expires, Lakshmi Mittal, ArcelorMittal chairman and CEO, said Thursday.

“Our expectation is that measures will be in place by September 6,” Mittal told investors on a webcast to discuss the company’s second quarter results. “We are in negotiation with the Italian government, which is working on providing us with legal safeguards…the works should continue to operate [however] no assurance can be given at this point in time.”

The AM Italia — known as Ilva before ArcelorMittal took it over last year — has not been environmentally compliant for some time. It has been given license to operate under government protection until September 6. However, the situation regarding any future license to operate the works is still unclear following a recent fatal accident on raw materials Pier No. 4 at the works in Taranto.

The latest accident occurred on the heels of an Italian public prosecutor ordering a production halt of blast furnace No. 2, following allegations that improvements promised for the works after an accident there in 2015 — when the mill was under previous management — had not been fully undertaken.

Mittal confirmed Thursday that Pier No. 4 continues under seizure. With operations currently only at Pier No. 2, the works is losing inputs of 10,000 mt/day of raw materials, which means the steelworks is currently producing at between 3 million mt and 3.5 million mt/year capacity, he said. “We don’t expect the situation to last indefinitely,” he said. All blast furnaces at the works are currently in operation, he said.

“ArcelorMittal aims to dramatically improve the performance of ArcelorMittal Italia in the second half,” Mittal said.

But the plant’s expected ramp-up to a 6 million mt/year run-rate, previously expected by H2 2019, has been slowed due to weak market conditions, ArcelorMittal said in its investor presentation. 

ArcelorMittal has a net capex commitment at ArcelorMittal Italia of Eur2.10 billion ($2.33 billion) through 2024, around half of which is in environmental measures, with all interventions in this area progressing in line with an accelerated timetable, according to the presentation.

— Diana Kinch

The European Commission’s steel import safeguards scheme must be strengthened to achieve the end it was designed for in a “highly challenging market,” ArcelorMittal CEO Lakshmi Mittal said Thursday.

In addition, all steel used in the EU needs to be subject to the same carbon levies as products made within the EU, Mittal said during a webcast with investors.

“We need an improvement in the safeguards,” said Mittal, noting that the EC’s current review of the safeguards will end on September 30. ArcelorMittal has opted to reduce its flat steel production capacity by 4.2 million mt/year in Europe in a move to better balance supplies and demand. The company will also destock in Europe in the second half which may be positive for prices, he said.

“It’s very hard for anyone to have a decent return, therefore production has to go down to give better results,” Mittal said.

Luxembourg-based ArcelorMittal swung to a net loss of $447 million for the three months ended June 30, against a net profit of $1.87 billion year on year, the global steelmaker said Thursday, amid weak demand and high import levels in Europe and extraordinary charges on operations in Italy and the US.

According to European Steel Association Eurofer, steel imports into the EU still accounted for nearly one quarter of regional consumption in Q1 despite the introduction of the quotas system on imports last year. Steel markets were buoyant for most of 2018 but at the end of that year started to suffer a “surprising downturn” followed by soaring key steelmaking raw materials prices, Mittal said. Steel consumption in China however continues “fundamentally in positive territory,” he added.

ArcelorMittal has no plans to take down capacity in the US and is proceeding with a hot-rolled coil expansion in Mexico and a cold-rolled, coated and galvanized steel expansion in Brazil, Mittal said. A positive performance in its mining division, which has benefited from high iron ore prices, “highlights the benefits of diversification,” he said.

Still, asset divestments will occur over the next two years, as the company embarks on a portfolio optimization program worth $2 billion, in a move to reduce net debt.

“Now we need to identify the assets,” Mittal said.

In Europe, Mittal indicated he was encouraged by a recent statement by Ursula van der Leyden, the incoming president of the EU Commission, of a “green border adjustment” which would mean steel products entering the EU would be subject to similar carbon costs as steel produced within the region. Carbon emissions costs under the Emissions Trading Scheme to which EU steelmakers are tied are currently at an 11-year high.

ArcelorMittal is developing three pathways to reduce carbon emissions from steelmaking, including hydrogen-based ironmaking, use of circular carbon energy sources and carbon capture and storage.

“All solutions we developed are unique and ahead of the curve,” Mittal said. “But to develop all these we need a level playing field.”

— Diana Kinch