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Europe cannot afford to hesitate on “green” steel, an industry that could still unlock industrial competitiveness for the region, according to researchers at the Stockholm Environment Institute (SEI).

“Scaling up European primary green steelmaking is essential for supply chain resilience and the competitiveness of strategically important downstream industries. By failing to move from innovation to deployment, the EU risks losing its relevance in global industrial development,” they warn in a report seen by Kallanish.

Chinese producers are squeezing European firms out of global markets. This has happened in sectors such as solar panels, battery cells and electric vehicles. Similar dynamics are now emerging in wind turbines and electrolysers, SEI notes.

The paper comes as Swedish firm Stegra struggles to close a funding round to implement its green hydrogen, green iron and green steel ambitions. Last year, the prospective producer received state aid from the Swedish government, which was below the amount approved by the European Commission. Despite securing customer deals, Stegra still faced additional state aid rejection for port infrastructure and write-downs.

“As the case of Sweden and Stegra illustrates, EU-level initiatives must be complemented by effective coordination across the Commission and member states to ensure delivery of the European Green Deal,” comment SEI research associate Jindan Gong and co-authors, including Max Åhman, professor and head of division, Environmental and Energy Systems Studies at Lund University.

Green steel is estimated to have a premium price of 20-30%, although costs will vary geographically. Northern Scandinavia, Portugal and Spain are said to offer unique cost advantages in Europe.

Separate research by Åhman suggests that the EU Emissions Trading System and the enforcement of the Carbon Border Adjustment Mechanism (CBAM) could make hydrogen-based steel production in these locations competitive by 2026. With a green hydrogen cost of €4.12-5.5/kg ($4.8-6.5/kg), the H2-DRI-EAF steelmaking route could be competitive with conventional production routes, the researchers claim.

However, the institute argues that if the costs of producing green steel are likely to be higher everywhere else in the near term, “the strategic question for Europe is not whether to act, but how decisively [it will act]”.

It notes the EU has three clear options: transition to low-carbon primary steelmaking using domestically produced clean energy or green iron imports; offshore its steel production; or continue to rely on fossil fuel imports. SEI concludes the consequences of delaying or retreating would be “profound” for European innovation, strategic autonomy and competitiveness.

The institute suggests that by 2030, green steel cost will range from €625 to €906/tonne.

 

Železiarne Podbrezová is looking into reducing precision seamless cold-drawn tube sales in favour of growing seamless hot-rolled tube deliveries, which it can sell in larger volumes and are more profitable, the Slovakian producer notes. The firm hopes the EU’s new trade regime will allow it to increase product prices later this year.

In 2025, the firm failed to meet sales targets amid a challenging market. Cold-drawn tube activity was more difficult as automotive, mechanical engineering and energy sector output remained on the decline. However, overall sales were “satisfactory”, the firm says, without providing tonnages, with hot-rolled tube performing better for a third consecutive year.

Precision tube sales are not threatened by imports from outside the EU, with competition being almost exclusively between EU mills, but the market is shrinking. Hot-rolled tube is seeing growing imports from China and Ukraine in the long term, but imports are also currently having a limited impact given this is a low value-added product and transport costs play a major role in trade.

In terms of electricity prices, “we would accept comparable conditions as EU countries. However, we know that even if any state aid were to come, it would not be at a level that would make us competitive in the world,” commercial director Vladimír Soták Jr says in the company’s latest newsletter seen by Kallanish. The firm expects the Slovakian government to implement support measures this year.

Sourcing electricity competitively is a problem as both European futures contracts and spot market prices are elevated, it adds, leaving state compensation as the only solution.

As for the prospects for increasing exports, “if we want to gain new customers or some new markets, we have to be better than current suppliers in something. However, competition is very strong in the world and everything also depends on the input costs of individual manufacturers. So I do not see a very realistic massive expansion of our customer portfolio,” says Soták.

“We see a light at the end of the tunnel, which is also due to the fact that we have better gas contracts agreed and purchased in advance every year. And also, because imports from countries outside the EU will be limited to a certain extent [by the new trade regime], we will be able to slightly increase the prices of our products, which will also certainly help us,” he concludes.

Electric arc furnace-based Železiarne Podbrezová increased crude steel production 12% on-year in 2024 to 273,160 tonnes, according to the latest data, of which 215,031t was used captively for tube production. Tube production rose 8% to 176,508t, utilising 88% of capacity.

Steel bloom sales totalled 59,752t, all for export, with hot-rolled tube sales up 6% to 122,668t and precision tube sales falling to 40,160t. Exports comprised 94% of overall tube sales.

The firm installed a new 63-tonne ladle at the EAF in 2025. It uses mainly scrap as feedstock.

 

The EU plans to require electric vehicle manufacturers that receive state support to source 70% of their car components from within the trading bloc. This will include 25% of aluminium products that are low-carbon, while for steel the requirement will focus on meeting a 25% low-carbon threshold without rules-of-origin conditions, Fastmarkets heard on Wednesday February 18.

The Industrial Accelerator Act (IAA) that will set out these requirements will be part of the EU’s wider “Made in Europe” strategy, which was intended to reinforce strategic autonomy by reducing external dependencies in critical manufacturing sectors.

The automotive sector uses a range of raw materials, and supply chains for modern electric or hybrid cars include a range of ferrous, non-ferrous and battery materials.

In recent years, the EU has been trying to promote industry while adhering to its strict net-carbon-zero regulations, despite the automotive industry being reliant on China to process critical minerals for batteries.

This has resulted in a range of policies. One of these is the “made in Europe” scheme to boost the demand side, while the ResourceEU and CRMA frameworks were intended to diversify supply for critical raw materials, such as lithium, graphite and cobalt for batteries.

Improvements have yet to be seen, with the Eurozone manufacturing purchasing managers’ index at 49.5 in January 2026, below the 50-point threshold that indicated that European business was still contracting due to weak demand and production.

The EU’s local battery industry also recently called for extra support to develop an independent European battery supply chain while gigafactories plans were being cancelled.

“This is no trial period: Automotive suppliers have announced more than 100,000 job cuts since 2024,” Benjamin Krieger, secretary at the European Association of Automotive Suppliers (CLEPA), said.

Initial versions of the act identified steel as the main focus, suggesting that public procurement and state aid for steel should require low carbon emissions and origin from the EU. But revisions to the act made in the week ended February 13 represented a significant shift, softening the “made in EU” rules and allowing certain third countries to be treated like EU producers in the public procurement of key industrial goods.

In the recently leaked Annexes to the IAA, seen by Fastmarkets earlier this week, public procurement procedures would require that at least 25% of the steel used in buildings, infrastructure and transport projects be low-carbon. A parallel 25% threshold would apply to aluminium.

But the wording differed for the two materials. For steel, the text specifies that “at least 25% of the total volume of steel used shall be low-carbon.” For aluminium, it states that “at least 25% of the total volume of aluminium used shall be low-carbon and of Union-origin.” This introduces a rules-of-origin requirement for aluminium that is not present for steel.

The same distinction applied to public support plans for construction, renovation and vehicle purchases, where aluminium must meet both low-carbon and Union-origin criteria, while steel is required only to meet the low-carbon threshold.

Aluminium markets face supply constraints with the closure of the Mozal smelter in Mozambique and the introduction of costs arising from the EU’s Carbon Border Adjustment Mechanism (CBAM) on January 1, 2026.

The secondary aluminium and billet market premiums were already starting to reflect these changes, as well as the reversion of import duty to 6% from 4%.

Fastmarkets’ weekly assessment of the aluminium 6063 extrusion billet premium, ddp North Germany (Ruhr region), was $540-570 per tonne on February 13, compared with $490-530 per tonne on January 2.

Supply constraints were expected to affect the primary aluminium market in the next few months, with the IAA adding further pressure on European producers to meet demand.

Meanwhile, for green steel, the IAA was expected to help with unlocking green steel demand through public procurement, if implemented decisively.

Europe’s green steel market continued to be under strain while subdued demand clashed with shifting policy support. Trading in both flat and long products has slowed significantly, with buyers pushing back against the current premiums for low-emission steel.

Industry participants continued to highlight the lack of downstream demand. Distributors and service centers have shown limited interest and producers maintained that stronger demand from end-users would be essential for green steel to move beyond its current niche status.

Reflecting the muted trading environment, Fastmarkets’ weekly assessment of the green steel domestic, flat-rolled, differential to HRC index, exw Northern Europe, was unchanged at €100-150 ($119-178) per tonne on February 12.

 

European prices for steel hot-rolled coil remained steady in the week to Wednesday February 18, following recent market shifts linked to the effects of the EU’s Carbon Border Adjustment Mechanism (CBAM) and other regulatory changes, Fastmarkets heard.

Market sources said that, while the sector increasingly focused on domestic production, demand levels remained low because the market was still adjusting to changing dynamics, but sentiment remained positive.

“The [domestic] market is a bit better than it was before. With imports less interesting because of CBAM, there is a big focus on domestic production now,” a market source in Northern Europe said.

Another source said that mills were pushing for higher offer prices but that it might take a few weeks for those levels to be achieved in the market.

Some estimates of workable prices were said still to hover around €650-660 ($772-783) per tonne ex-works, no new trading activity was reported during the day.

Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Northern Europe, was €662.81 ($782.49) per tonne on February 18, unchanged from February 17.

The index was up by €10.31 per tonne week on week and by €22.31 per tonne month on month.

In Italy, market sources also noted low demand in the market. Estimates of workable prices were reported within the range of €650-660 per tonne ex-works.

Fastmarkets’ daily steel HRC index, domestic, exw Italy, was calculated at €655.00 per tonne on February 18, down by €1.20 per tonne from €656.20 per tonne on Tuesday.

But the index was up by €7.83 per tonne week on week and by €23.75 per tonne month on month.

 

The mood in the European domestic steel hot-rolled coil markets was upbeat on Monday February 16 amid news that the market leader was pushing for higher prices, Fastmarkets has heard.

Earlier in the day, several market sources reported that ArcelorMittal had increased its offer price for hot-rolled-coil to €750 per tonne delivered Northern Europe for May delivery, from the price of €700 per tonne delivered that was announced for April-delivery coil.

The information had not been officially confirmed by the company at the time of publication of this report. Few market sources believed that there would be an official announcement of this price rise by the company in the next few days, with strong order books being given as one of the key reasons for the upbeat tone.

One source reported the supplier selling some tonnages at €700 per tonne delivered, which would be equivalent to €685 per tonne ex-works.

“They want to pass the €700 per tonne delivered threshhold,” another buyer said.

Estimates of workable prices from other integrated mills in the region were said still to vary within the range of €650-660 per tonne ex-works, with an offer from a re-roller in the Benelux area reported at €650 per tonne ex-works, with trading said to be muted.

Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Northern Europe, was €660.00 ($782.34) per tonne on February 16, up by €4.17 per tonne from €655.83 on February 13.

The index was up by €6.67 per tonne week on week and by €19.50 per tonne month on month.

In Italy, the workable price range was very wide, depending on the tonnage, at €630-660 per tonne exw.

Minor tonnages were reported sold at €650-660 per tonne ex-works, while large tonnages, which were nowadays an exception, changed hands at €630-640 per tonne ex-works.

Fastmarkets’ daily steel HRC index, domestic, exw Italy, was calculated at €651.60 per tonne on February 16, up by €4.10 per tonne from €647.50 per tonne on Friday.

The index was up by €6.60 per tonne week on week and up by €20.35 per tonne month on month.

 

Steel distribution group Klöckner & Co’s management board and supervisory board have jointly recommended that shareholders accept Worthington Steel’s voluntary public takeover offer, Kallanish notes.

“Following careful review of the offer document, the boards have independently concluded that the offer is in the best interests of the company and its stakeholders,” the boards say in a joint message. “In assessing financial adequacy, the management board and supervisory board also considered the opinions of their respective financial advisors Goldman Sachs Bank Europe and Deutsche Bank. We welcome the offer and recommend that Klöckner & Co shareholders accept Worthington Steel’s offer and tender their shares.”

The members of the management board will tender all shares held by them into the offer. In addition, according to the bidder’s notification, SWOCTEM GmbH, the largest shareholder of Klöckner & Co, has already tendered its entire stake of approximately 41.53% in Klöckner & Co into the offer, they add.

Worthington Steel is offering Klöckner & Co shareholders €11 ($13) in cash per share. The implied total enterprise value of the transaction is approximately €2.1 billion ($2.49 billion),

The offer price represents a premium of approximately 81% on the closing price of the Klöckner & Co share on 5 December 2025, the last day before negotiations regarding a public takeover offer by Worthington Steel were publicly announced. And approximately 98% based on the undisturbed three-month volume-weighted average price of the Klöckner & Co share up to 5 December 2025.

The management board and supervisory board consider the offer price to be attractive, fair and reasonable.

The acceptance period is expected to end on 12 March 2026. Klöckner shareholders can accept Worthington Steel’s takeover offer through their custodian bank and tender their shares into the offer.

The business combination agreement signed on 15 January 2026 between Klöckner & Co and Worthington Steel sets out the key parameters of the planned business combination. The objective of the agreement is to create a foundation for sustainable growth through the complementary orientation of both companies and to expand market presence in Europe and North America.

As part of the partnership, Worthington Steel supports Klöckner & Co’s strategy to focus on higher value-added products and services, and has commited to the long-term development of the group.

 

European automotive suppliers are calling for the implementation of technology neutrality to ensure innovation drives decarbonisation – not restrictive mandates, according to the European Association of Automotive Suppliers (CLEPA).

The upcoming Industrial Accelerator Act presents a clear opportunity to keep automotive manufacturing in Europe but its success hinges on one key question: how the EU defines ‘European-made’ components, it claims.

“This is no trial period: Automotive suppliers have announced over 100,000 job cuts since 2024,” says Benjamin Krieger, secretary general of CLEPA. “There is no strong European economy without the factory floors to support it. Right now, with high energy costs and fragmented regulations slowing companies down, producers in Europe are placed at a structural disadvantage. Measures to restore EU competitiveness will take time to deliver, that is why we need local content policies now.”

It references a recent study by Roland Berger reveals that automotive suppliers in the European Union face unfair competition from regions with lower costs, fewer regulations, unilateral tariffs, excess capacity, dumping and subsidies – a combination that threatens up to 350,000 European jobs until 2030, Kallanish notes.

“Importing the cheapest technology today hollows out our innovation capacity tomorrow,” CLEPA adds. “If Europe allows its value chains to erode, we will end up with empty factories – we will trade European independence for permanent dependency on regions with cheaper labour and weaker legal requirements.”

“The Industrial Accelerator Act must be robust. Specifically, it needs an adequate definition of ‘European-made’ vehicles and components,” it notes. “A European vehicle should consist of at least 75% European components. This level is realistic and would not drive-up prices. The study by Roland Berger shows that more than 80% of the components used in vehicles built in the EU already come from European suppliers.”

Automotive suppliers are the engine of Europe’s green transition, investing €30 billion ($35.5 billion) annually in research and development. For these innovations to succeed at scale, however, policy must align with consumer demand. Deloitte’s 2026 global automotive consumer study shows that internal combustion engines remain the leading choice for nearly half of buyers in Germany, France, and the UK while consumer preference for hybrids has risen to 14% in Germany and 23% in France.

To survive global competition and to ensure our strategic autonomy in manufacturing, the EU must move from promises to implementation, delivering these measures fully, and without further delay, CLEPA concludes.

 

A coalition of European industry players, which includes GravitHy and Hydnum Steel, is calling on the European Commission to strengthen the upcoming Industrial Accelerator Act (IAA) and implement demand measures to boost low-carbon industrial products.

E3G, Hydrogen Europe, and Mission Possible Partnership are just some of the 40 organisations also supporting the call.

“Demand-side provisions appear largely confined to public procurement and public support schemes, as well as restricted to a few sectors, namely steel… We strongly support demand-side initiatives for the public sector as an effective lever to create demand. However, the public sector alone cannot create sufficient demand for low-carbon products at scale, and the limited number of sectors targeted risks increasing market fragmentation,” a joint statement seen by Kallanish says.

It adds that the Commission’s internal draft is unclear as to whether low-carbon requirements for public procurement and public schemes would be complementary or subordinated to origin-based criteria.

The signatories argue that without stronger market measures that scale up demand, European producers of low-carbon products will struggle to compete globally.

They recommend a range of policy tools, including EU harmonised product standards, mandatory green public procurement with minimum content quotas for low-carbon and EU/EEA origin requirements, and mechanisms to stimulate private demand through mandates and financial de-risking instruments.

The IAA is expected to play a key role in implementing parts of the European Commission’s Clean Industrial Deal by scaling up low-carbon manufacturing and creating competitive conditions for European products.

The signatories warn that simply relying on public sector procurement will be insufficient to drive the transition to net-zero technologies. They say that stronger demand instruments will help secure investment, maintain jobs and attract new players to Europe’s clean industrial value chains.

The IAA is currently under development and expected to be presented by the Commission as part of its 2026 work programme.

GravitHy is building a green hydrogen-based direct reduced iron and hot-briquetted iron plant in Fos-sur-Mer, Southern France. The facility is projected to produce up to 2 million tonnes/year of DRI and HBI, fed with hydrogen produced by a 750 MW electrolyser (see Kallanish passim).