EC notifies Vietnam of HRC dumping complaint
The European Commission said it has notified Vietnam that it has received a complaint for the initiation of an anti-dumping investigation into imports of hot-rolled coils (HRC).
The commission did not identify who filed the complaint against Vietnam.
Should a probe be launched, the commission may decide to pick a sample of exporters to investigate because of the large number of producers from Vietnam.
Market participants have expected an EU investigation into Vietnamese HRC imports since volumes started picking up. Last year Vietnamese imports of HRC into the EU rose to 1.13mn t, from 400,000t in 2022. Vietnam has frequently been the lowest-priced supplier on the market, targeting primarily large buyers and pure commodity grade coils. Since the launch of the Argus HRC cif Italy origin differentials earlier this year, Vietnam has traded at a discount.
There is talk that an investigation into Vietnamese hot-dip galvanised (HDG) could be launched too, and a probe into HRC imports from major ‘other countries’ such as Taiwan, Japan and Egypt..
Vietnam itself has this week launched a dumping investigation on imports of HRC from China and India and previously into HDG from China.
By Lora Stoyanova
EU demand pushes up Turkey’s steel exports in H1: association
Turkey’s steel exports revenue in H1 2024 rose 10.6% year on year to $8 billion, Mediterranean Ferrous and Non Ferrous Metals Exporters’ Union (ADMIB) Head Fuat Tosyali said in a statement July 27, without citing tonnages.
Higher demand from the EU supported H1 exports, he said, adding that mills had begun to receive the fruits of investments to comply with the EU’s Green Deal.
“We are expecting to exceed the first half growth seen in our export volumes in the second half of the year,” Tosyali said.
Turkish mills witnessed double-digit increases in exports to Italy, Romania, Spain, Greece and the UK in H1, according to ADMIB data.
Turkey, which lost its net steel exporter position and became a net steel importer in 2023 for the first time since 2015, has set a 17 million mt export target for 2024.
“Despite global challenges, Turkish steel producers have been continuing their investments to carry them one step further in global competitiveness and to provide sustainability,” Tosyali said.
Tosyali Holding’s 4 million mt/year quantum electric arc furnace-based flat steel mill started production in January, while some other large steelmakers also recently launched new steel capacities.
Platts, part of S&P Global Commodity Insights, assessed Turkish domestic hot-rolled coil at $570/mt EXW July 26, down 20% since the start of 2024.
European HRC prices remain mostly steady amid peak summer holidays
Domestic prices for European hot-rolled coil stayed mostly steady as a peak summer season continued to result in very low levels of demand and a pessimistic outlook going forward.
“It is the high season of the holidays now and the market is very quiet,” a service center source said. “I don’t think anything will happen in the next few weeks.”
“No change of the situation due to summer vacation season,” another service center source said.
The market fundamentals for coils remain strained with a combination of significantly low levels of demand and excessive levels of supply. Sources said that mills need to announce production cuts to support prices, which would otherwise fall further.
A large proportion of the strain on the industry comes from the low and sluggish growth within the European automotive sector, which is struggling to compete with its more cost-effective Chinese counterparts, market sources noted.
“Globally, prices are under pressure,” a service center source said. “With competition from Chinese electric cars, it is more or less impossible for domestic automotive producers to sell anything.”
Platts assessed Northwest European HRC at Eur625/mt ex-works Ruhr July 29, stable on the day.
Tradable values were reported at Eur605-630/mt EXW Ruhr.
Meanwhile, Platts assessed domestic HRC prices in Southern Europe at Eur620/mt EXW Italy July 29, down Eur5.
Tradable values were reported at Eur610-625/mt.
Prominox buys Outokumpu’s Mexican distribution business
Stainless-steel supplier Prominox has acquired the Mexican distribution business of Finnish steelmaker Outokumpu, Kallanish learns.
The agreement includes large centres in Mexico City, Guadalajara and Monterrey formerly known as Outokumpu Mexinox Distribution (OMD).
“We are delighted to incorporate Outokumpu’s solid distribution business into Prominox being confident that by adding the strategic locations and customer base to our portfolio, we are reinforcing our position as the leading stainless-steel distributor in Mexico,” says Prominox’s president, Ivette Autrique.
In a separate note, Outokumpu confirms that the divestment of the OMD unit is due in part to dedicate more resources to the strategic areas of Mexico and the US as the warehouses serve largely smaller volumes. “We will continue to fulfil customers’ orders that are served by OMD until the transaction with Prominox is completed,” Outokumpu adds.
The acquisition is now awaiting approval from Mexican authorities and other closing conditions. The transaction should be completed during the next few weeks.
Prominox and Outokumpu did not reveal any financial details of the agreement.
Todor Kirkov Bulgaria
Austria production falls in June despite EU growth
Austria’s steelmakers decreased crude steel production in June compared with the previous month, according to worldsteel data.
Output amounted to 633,000 tonnes, down by 2.6% from May and 0.3% less year-on-year, Kallanish notes. Austria fell from 21st place to 22nd in the ranking of top ten global steel producers, worldsteel data show.
In January-June, however, the country produced 3.81 million tonnes of steel, up 0.7% on-year.
Overall EU output in June increased by 5% y-o-y to 11.08mt. In the first six months of the year, steel production was 0.9% more on-year versus January-June 2023 to 67.2mt.
Austria’s largest steelmaker, voestalpine, said earlier market trends have not changed significantly following the start of its 2024/25 business year in April (see Kallanish passim).
In fiscal 2023/24 – ending March 2024 – voestalpine achieved satisfactory results, with overseas markets performing better than Europe. It said it expects good demand from railway infrastructure, aerospace, and warehouse technology to continue. The automotive industry and the energy sector, as its main segments, should largely continue their stable development to date.
The group’s revenue in 2023/24 was its second-highest in history, at €16.7 billion ($18.2 billion), after achieving record revenue of €18.2 billion in the previous year. Key figures have now “returned to normal” in the latest reporting year, voestalpine noted. Ebitda reached €1.7 billion, down from €2.5 billion.
In 2023, Austria’s commerce chamber, Wirtschaftskammer Österreich (WKO), expressed concern over the crash in demand and orders for commodities in the country (see Kallanish passim). WKO saw orders declining by as much as 30%, with no relief in sight.
Svetoslav Abrossimov Bulgaria
Italian HRC buyers shun imports, eye delayed clearance
Import offers for hot rolled coil from Asia into Italy have decreased by approximately €20/tonne ($21) compared to last month, but buying interest is low. Italian importers using the country’s unique customs clearance amendment system meanwhile aim to clear imported material stocked at ports by year-end.
HRC offers from Asian suppliers range from €570-580/tonne ($617-628) cfr Italy, while Turkish material is available at €570/t cfr.
According to a trader’s analysis, current spot market coil sales for import are expected to go through customs clearance only in April 2025.
Italian buyers will be able to clear through customs without duty material imported in the second quarter but left in consignment at ports no earlier than from 1 January 2025, says one Italian importer of HRC. This is because they need to clear tonnages gradually each quarter to avoid duty payment. Italy allows buyers to modify or cancel their customs clearing authorisations and use partial clearing, which is a feature unique only to this country.
Each EU country’s customs authority has the freedom to establish its own regulations while following the EU quota allocation procedure. Companies have the option to choose whether to clear the entire imported amount or only a portion of it in order to avoid paying some of the duties, according to the Italian customs authority, Agenzia delle Dogane e Monopoli (ADM).
Buyers have the option to restrict the import authorisation to only the portion of the goods that falls within the duty-free quota. Alternatively, one may choose to complete the import for the entire quantity declared and pay duties on the tonnage above the duty-free allocation.
On 1 July, a number of buyers in Italy made the decision to leave approximately 40% of their imports at ports in order to circumvent payment of the prohibitive duty. According to one source, the tonnage of coil that a buyer leaves at the port will be added on top of any newly imported quantities, with the buyer then able to decide what volume to clear in a given period.
At the beginning of each quarter, the buyer will enter the code 00100 into the ADM system, which will generate a new calculation for the portion of the goods eligible for the quota. The buyer will then assess the quantity of material to be cleared through customs.
From now until the end of the year, several importers who spoke to Kallanish intend to systematically clear the majority of imports that have been left at ports. ADM refers to this regulation as pro-rata allocation, However, sources point out that there are costs involved in transporting and storing the coil, which carries the risk of material deterioration.
Natalia Capra France
Swedish start-up GreenIron secures additional financing
GreenIron H2 AB, the relatively new Swedish player with a proprietary recycling technology that allows for iron production using hydrogen, has collected SEK 100 million ($9m) of additional financing provided by existing shareholders.
In April, it obtained the environmental permit for its first full-scale production unit in Sandviken, Sweden (see Kallanish 2 May). Construction of the facility is ongoing and the firm expects commercial production of fossil-free iron to begin by the end of 2024.
The latest financing paves the way for a larger financing round within the next six to nine months. “This enables us to continue our journey towards our goal of 300 furnaces by 2030, in the pursuit of a sustainable future,” says company chief executive Edward Murray.
Christian Koehl Germany
Spain’s automobile sector dips in June
Spain’s car industry saw its performance decline in June, Kallanish notes.
According to national automotive association Asociación Nacional de Fabricantes de Automóviles y Camiones (Anfac), output in June was 218,950 units, compared to 249,515 vehicles in May. This was also 7.1% less than the same month in 2023. Of the total, 75.4% was gasoline and diesel-powered automobiles. Six-month production amounted to 1.33 million units, just 1.1% more compared to January-June last year.
“Despite the decline observed in the last two months, the overall annual rate remains stable and above that of the previous year,” says Anfac general director José López-Tafall.
He however notes there has been a decline in electrical vehicle business due to model changes and production readjustments. “It is a priority for manufacturers to sell more plug-in models, both in Spain and abroad. The end of purchase subsidies in countries like Germany, one of our main export destinations, is causing a sharp drop in demand, which is affecting orders at our factories.”
Spanish vehicle exports fell in June. Shipments were at 186,813 units, compared to 221,354 units in the previous month and 9% lower than in June 2023.
European markets had a 93.5% share in Spanish deliveries in June, unchanged on-month and 2.3 percentage points higher on-year. Six-month exports slipped 0.5% over the same period in 2023 to 1.17 million vehicles, Anfac data show.
Todor Kirkov Bulgaria
Eurofer: Flats drive EU import growth, exports rise
Flat products, whose intake surged by 30% on-year, continued to drive EU steel imports in the first four months of 2024, says Eurofer. Longs intake fell 9%.
India maintained the leader position with a 15.8% share in EU finished steel imports, followed by Turkey with 12.6% and Vietnam with 10.3%, Kallanish notes.
While finished steel intake from China and Korea fell 38% and 11% respectively in January-April, imports from Turkey surged 85%, from India by 62% and from Vietnam by a whopping 155%.
Imports of all flats products rose, with the largest increases seen for hot-rolled wide strip, by 51%, hot-dipped galvanized coil by 44% and coated sheet by 41%. In the longs segment, only wire rod intake rose, by 19%.
EU finished steel exports meanwhile rose in the four months, with flats up 2% and longs 5%. The main destinations were the UK, US and Turkey. Finished steel shipments to United Arab Emirates ballooned 241%, with shipments to the US rising 21% and to China by 13%.
Exports of all flats rose – except for hot rolled wide strip – with quarto plate and cold rolled sheet seeing the largest growth. Longs shipments diverged, with rebar and heavy sections up 24% and 17% respectively, but merchant bar and wire rod declining.
Total EU steel trade deficit in the four months thus amounted to 1.4 million tonnes – it was 1.3mt in full-year 2023. Finished steel trade deficit was 775,000 t/month in the period, despite a slight surplus for longs.
The largest finished steel trade deficits were recorded with India (298,000 t/m), South Korea (218,000 t/m) and Taiwan (193,000 t/m). Surpluses were registered with the US (191,000 t/m), the UK (104,000 t/m) and Switzerland (76,000 t/m).
Adam Smith Poland
Kloeckner Metals focuses on value-add to fend off steel price volatility
Fastmarkets’ calculation of its steel hot-rolled coil index, fob mill US Midwest plunged from $55 per hundredweight ($1,100 per short ton) in January 2024 to about $32 per cwt in mid-July.
Kloeckner, one of the biggest service centers in North America with 55 branches, made the biggest of those four acquisitions in August 2023 with the purchase of Nuevo Leon-based National Material of Mexico for $340 million.
The company also acquired Sol Components and Industrial Manufacturing Services in October and November 2023 respectively, and announced the purchase of Amerinox’s assets in Camden, New Jersey in July 2024.
Entering automotive business
The Mexican investment included Kloeckner entering the automotive business and higher value-added electrical steel-related products and services. Mexican-made electrical steel-related products serve markets within Mexico, the US and Canada.
“The move into automotive is an example of expanding the core [business], giving us capabilities to get into markets that we haven’t been in,” Ganem said.
Speaking about Kloeckner’s other recent purchase, Ganem said the Industrial Manufacturing Services purchase allowed the company to reach “the highest level” of value creation possible for a service center.
“We are actually providing a finished part to an [original equipment manufacturer]… Those parts are formed, welded and even painted in many cases” he said.
“And those types of businesses, not everybody can do — they generate a much higher return. The value that we are creating in the process is not as susceptible to price volatility” because the price of steel makes a much smaller component, he said.
Ganem said that in recent years “we’ve seen record levels of volatility, and I think the strategy has allowed Kloeckner Metals, certainly in North America, to be able to navigate those cycles much better than we had in the past.”
With the purchase of Sol Components, a maker of solar energy equipment, ”it’s more of the same,” he said.
“That plays right into our higher-value-add strategy, because many of the parts and components that go into a solar structure are fabricated parts,” Ganem said.
The CEO also noted “much higher prices and margins” in relation to the purchase of Amerinox, due to processing stainless steel and aluminum.
“Any increase in the mix of stainless and aluminum that we can sell is also well aligned with our higher-value-added strategy,” Ganem said. Amerinox also brings advanced capabilities like polishing to Kloeckner, he added.
Possible acquisitions
Kloeckner, which generated $4.5 billion in revenue in 2023, will target assets for acquisition that could result in synergies and further expand the company’s added value strategy, Ganem said.
“We look at the opportunities that arise,” Ganem said. “They can be opportunistic. We don’t have to do anything. We are really in good position today, but we are here to grow, especially when it comes to the higher-value-added part of our business.”
Recent acquisitions by other service centers point to a trend of consolidation in the steel processing industry.
Companies like Reliance, Ryerson and Olympic Steel are among those that have made acquisitions within the past couple of years.
Based on the number of existing service centers, there appears to be more room for industry consolidation: The Metals Service Center Institute, which groups service centers, mills and affiliates, has over 2,300 members, many of them in the US Midwest and Northeast.
