Category: Latest Updates

In a letter to Stéphane Séjourné, European Commission executive vice-president, and Maroš Šefčovič, European Commissioner for trade and economic security, the European Federation of Steel, Tubes and Metals Distribution & Trade (EUROMETAL) raises serious concerns about the exclusion of steel derivatives and downstream products from the EU’s current safeguard framework.

The federation said it supports the Commission’s efforts to address global steel overcapacity, though it cautions that the proposed measures, which focus on primary steel protection – if not adjusted – risk accelerating the displacement of EU manufacturing and distribution.

Downstream producers face threat to their survival

According to EUROMETAL, the cost of steel accounts for up to 70 percent of total sales in steel-processing companies, while average profit margins rarely exceed 1-2 percent. A 10 percent rise in EU steel prices under the new safeguard regime could drive many processors and manufacturers out of business before the end of the planned two-year review period.

Excluding derivatives, EUROMETAL warns, would allow “cheap processed imports” to flood the market.

EU risks becoming dumping ground for low-cost steel products

EUROMETAL stated that imports of steel derivatives have been displacing EU manufacturers by offering finished products at prices below what EU firms can match, even before the safeguard reform takes effect. The group cautions that, unless the scope of safeguards is extended to steel derivatives and downstream products, the EU risks becoming the global “dumping ground” for low-cost steel products.

Accordingly, EUROMETAL urges the European Commission to:

• extend safeguard coverage to derivatives and downstream steel products;
• conduct an impact assessment on processors, distributors, and SMEs;
• maintain flexibility tools such as carry-over mechanisms;
• ensure fair access to competitively priced materials;
• adopt country-specific quotas to improve predictability and support responsible trade flows.

steelorbis.com

The European Commission has unveiled a new set of coordinated actions to reduce energy prices for both industries and consumers, marking the next phase of the Affordable Energy Action Plan.

Although energy costs have fallen from their 2022 peaks, they remain significantly higher than global competitors, undermining industrial competitiveness and household affordability. The Commission’s new plan focuses on immediate relief and long-term structural measures in cooperation with EU member states.

Seven actions to reduce energy costs

The Commission has presented seven key measures to accelerate cost reduction and ensure secure, affordable and sustainable energy across the EU:

• Member states are urged to make full use of the Clean Industrial Deal State Aid Framework (CISAF), which allows targeted aid for energy-intensive sectors through price relief and decarbonization support. The Commission will issue guidance for national schemes by the end of 2025, ensuring consistent application of state aid across member states.
• Governments are encouraged to reallocate EU Cohesion Funds to modernize national grids and expand energy storage capacity. Revised investment programs can be submitted before the end of the year, and the Commission will assist member states in designing efficient, low-risk funding mechanisms.
• The Commission advises industrial companies to engage with the European Investment Bank (EIB) and national promotional banks to access new financing tools. A €500 million pilot program has been launched to support corporate Power Purchase Agreements (PPAs), helping companies lock in stable, long-term energy prices and reduce exposure to market volatility.
• Member states are encouraged to speed up permitting procedures for renewables, storage and grid projects, applying the new rules of the Revised Renewable Energy Directive (RED III). Additional simplifications will be included in the upcoming Grids Package, scheduled for adoption before the end of the year.
• The Commission will enhance cross-border energy links and domestic grid infrastructure through the Energy Highways initiative, addressing eight key bottlenecks across the EU Energy Union.
• To ensure affordable gas prices, the EU will expand partnerships with suppliers such as the United States, Norway and Qatar. A regional demand collection exercise will be launched in southeast Europe to secure competitive and diversified gas procurement for industries and utilities.
• Recognizing that taxes can account for up to one-third of energy bills, the Commission will issue recommendations and technical assistance to help member states reduce electricity taxes, particularly for energy-intensive industries and vulnerable households.

steelorbis.com

A number of market participants said on Thursday that mills in Northern Europe almost closed their order books for December delivery within the range of €580-590 ($673-684) per tonne ex-works and have only minor tonnages left to be sold.

Meanwhile, customers’ estimates of workable levels for January delivery material were within the range of €600-620 per tonne against mills’ targets of €620-650 per tonne ex-works, depending on supplier.

Mills started to actively increase offers following the European Commission unveiling a proposal for sweeping reforms of its steel import safeguards, suggesting cuts in tariff-free quotas by about 47% and imposing a steep 50% ad valorem duty on any volumes beyond the new threshold earlier in October.

The approaching introduction of Carbon Border Adjustment Mechanism (CBAM) starting January 1, 2026, is another factor playing into local producers’ hand as climate policy will price carbon emissions embedded in imported steel goods so that products that enter the EU face the same carbon costs as EU produced goods.

Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe was €600 per tonne on Thursday, up by €2.86 per tonne from €597.14 per tonne on Wednesday October 22.

The index rose by €8.75 per tonne week on week and by €21.25 per tonne month on month.

Fastmarkets’ corresponding daily steel hot-rolled coil index domestic, exw Italy was calculated at €590 per tonne on Thursday, up by €1.67 per tonne from €588.33 per tonne on Wednesday.

The Italian index was up by €8.33 per tonne week on week and by €40.00 per tonne month on month.

The sharp rise in Italian domestic prices was attributed to the fact that this market was more exposed to import, while competition in the domestic market was limited.

Market sources estimated workable HRC prices in Italy in the range of €580-600 per tonne ex-works on Thursday. A sell-side source reported deals at the lower end of the range.

Another Italian producer, however, flagged 40,000 tonnes of Indonesian HRC being booked by a compatriot mill at €465-470 per tonne CFR, with delivery scheduled for early 2026.

European coil demand remains subdued, with major buyers continuing to adopt a wait-and-see approach, steel processors confirmed at the Blechexpo trade fair in Stuttgart on Wednesday, attended by Kallanish.

Both producers and processors noted that market indexes are lagging behind current values, with the previously available €580/tonne ($678/t) base delivered level for hot rolled coil no longer achievable. “Buyers have purchased very little lately so prices were not clearly available,” a steel processor commented. Sources reported current HRC prices at around €600/t base delivered, with slightly lower figures for some volumes.

However, trading activity remains limited, and European ports are now receiving the material purchased from Asia during the summer. In anticipation of CBAM and new safeguard measures, several buyers confirm having secured substantial tonnages from the import market for delivery before year-end. Many opted to build stockpiles to limit exposure to higher European prices.

European producers are currently seeing prices recover, though the increase remains gradual and based on sales of relatively low volumes. To see volumes recover, “they [mills] will have to hold [prices] firm for at least another month,” another steel processor comments.

Values are gaining traction and the general sentiment at the trade show was positive. Steel processors, including service centres and re-rollers, confirmed that derivative prices are rising. However, forecasts suggest a slower recovery than producers would prefer. While some steelmakers are refraining from quoting for first-quarter delivery, others are offering HRC at around €650/t base delivered for January.

According to several steel processors at the event, this level is “overly ambitious” compared with sheet, strip, and tube prices downstream, which are expected to continue increasing but moderately. The “gradual” and “moderate” nature of the recovery reflects the reality that downstream demand is not driving current price gains and is likely to remain subdued in the coming months.

CBAM and the new safeguard measure are generating significant confusion in the market. Multiple sources called it “a mess”, noting that estimated CBAM costs could be anything between €20 and 200/t.

An international trading company reported shifting its focus away from commodity products to concentrate on niche, high value-added materials. A larger trader, however, admitted that moving away from the traditional commodity coil business model is not feasible, as volume sales remain essential for survival.

Many customers are reportedly asking traders to absorb CBAM related costs, a request often refused. However, in some cases, “we are taking risks”, a trading source conceded.

Several service centres are also facing steep duties on hot-dipped galvanised coil imports. One importer, previously reluctant to clear material through customs, was obliged to do so and pay the safeguard duty, to avoid paying CBAM charges in January.

HRC and other coil prices are expected to continue rising gradually but inevitably, according to unanimous opinion across the trade show. A German source said mills would not release any more volumes of HRC in Q4 for less than €600/t ex-works. It was suggested by some market participants last week that some residual volumes were still available for less, but that option seems to be exhausted now. He sees €600 as being a psychological mark that will not be undercut.

Natalia Capra France

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The new quota system proposed by the European Commission earlier this month to replace the existing safeguards will be dynamic and will be applied quarterly to 26 product categories in a first phase, with the possibility of revision, according to Enrique Arrieta, European Commission policy officer for trade and economic security.

The measure is expected to enter into force in June 2026, with a “relatively immediate” effect, although its long-term impact will be assessed in the light of market developments. “We have put in place mechanisms that will allow the Commission to adapt the measure to different economic scenarios,” Arrieta said at the Steel Tech 2025 conference in Bilbao on Wednesday, attended by Kallanish.

According to the expert, steelmakers have made it clear they do not want the new import system to cover semi-finished steel. “We are not deliberately excluding this category,” Arrieta pointed out. “We have a high level of engagement with the industry, and we are trying to understand their needs so that the measure better responds to them. Therefore, the Commission does not see the need to include something that has not been requested by the industry itself.”

However, Brussels reserves the right to amend the product codes subject to the measures, provided there is sufficient evidence and justification to extend their scope.

As for negotiations on an EU-US trade agreement, Arrieta said there is still no definite date for its signature and that progress will depend “largely on the willingness of the US counterparts”.

He added that one key requirement for moving forward will be that the countries with which a tariff reduction is negotiated have a solid level of customs protection. “In the past, we have been criticised for not having a sufficiently secure level of protection. I believe that with the latest proposals from the European Commission, we have shown a substantial improvement,” Arrieta stressed.

Despite mutual interest and expressions of goodwill, there is still no clear timetable for concluding the agreement.

“We believe that our proposal represents a solid starting point, with requirements that allow for a more equitable treatment in their [US] market, which is very important for them as well as for us,” he added.

Todor Kirkov Bulgaria

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French long steel consumption remains stable compared to last month, with multiple buyers reporting stable volumes albeit at margins too low to turn a profit, Kallanish hears.

Uncertainty and political instability continue to weigh on sentiment as investments are delayed, and trading volumes remain relatively low.

A large buyer says that mills continue to produce, but sales are below the level of production, which creates a fragile balance.

While transaction prices for longs remain largely unchanged from early-October levels, sources see that competition between European mills is strong. This, coupled with weak sales, high production volumes and increasing producer stocks, may cause prices to slide, particularly on some products such as merchant bar where foreign competition is fierce.

The EU’s new safeguard proposal and CBAM coming into force in January should not impact longs prices, according to market participants, as imports from overseas are minimal. Tube and sheet prices are instead edging up following the recent increases implemented by coil producers in Europe, including ArcelorMittal.

In the south of France, the presence of Spanish and Italian producers is resulting in longs prices that are slightly lower than in the north.

A seller in the Lyon area reports Italian and Spanish prices for rebar about €30/tonne ($35/t) lower compared to domestic prices.

“Steel processors and distributors are not managing to make any money, as there are practically no margins. Companies are chasing volumes and fighting, and negotiations with producers are complicated,” one market source comments.

Producers of long and flat products are attempting to push through price increases, yet buyers remain sceptical due to slow consumption. One producer notes that inventories are slow to deplete, leading to stock accumulation.

Rebar values remain unchanged at around €600-620/t delivered on average, with sales limited to relatively small volumes as stocks deplete slowly.

Sections are similarly stable at €750/t delivered on average. The recent attempt to increase prices to €770-780/t in September was not successful.

Merchant bar prices represent the competition of Spanish producers and remain unchanged at €220-240/t delivered.

Considering the slow market and the competition amongst European producers, prices are forecast to be weak in the coming weeks.

Natalia Capra France

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Some coil producers attending the Blechexpo event in Stuttgart this week tell Kallanish they are refraining from issuing quotations for the first quarter of next year. Many are adopting a wait-and-see approach as they monitor market developments, particularly the implementation timelines for CBAM and new EU safeguard measures, before setting future coil prices.

Suppliers in Europe are also considering ArcelorMittal’s one-month production halt at its Fos-sur-Mer steelworks in France, which will impact supply availability in the coming weeks. ArcelorMittal is currently quoting hot rolled coil at €630/tonne ($731) delivered for December delivery and €650/t delivered for January, with other European producers quoting similar values.

An Italian steel processor says buyers across the market “both large and small, have yet to return to active purchasing. Everyone is now assessing the situation and trying to reorganise their future procurement strategies by increasing the share of their purchases within Europe.” Another market participant notes that European and Italian coil prices remain stable compared with last week, as demand gradually improves along the value chain, including for downstream products such as sheet.

For now, there is little urgency in the market to buy, as large import volumes ordered during the summer continue to arrive at European ports. Both producers and service centres in Italy report renewed customer enquiries for quotations. According to sources, €570-580/t base delivered for HRC is no longer available. Several buyers confirm small transactions taking place in Italy at €600-620/t base delivered.

The market is currently in a transition phase, with customers focused on assessing future price trends and preparing to buy more in Europe. A seller confirms end-users have begun requesting quotations for first-quarter deliveries, while service centres are expected to resume purchasing within the next few weeks to cover year-end and early-2026 requirements.

“Next year, we may see a higher share of indexed contracts, as major buyers reduce their purchases from Asia and increase sourcing within Europe,” one buyer comments. According to market rumours, some large buyers are already bidding to secure substantial volumes of HRC for 2026.

Another market observer notes that European producers may need to increase capacity and restart some blast furnaces to meet rising domestic demand. Overall, the recent and future price increases are being viewed positively across the value chain, as service centres and re-rollers are also gradually managing to pass on price hikes to customers.

Several sources forecast HRC prices reaching around €650/t base delivered in January, and €750-760/t for hot-dipped galvanised and cold rolled coil. At these levels, the impact on downstream and manufacturing sectors remains manageable. However, further price escalation could have negative repercussions, eroding competitiveness within the European manufacturing industry.

Natalia Capra France

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