Category: Latest Updates

Danieli chairman Gianpietro Benedetti has passed away at the age of 81.

He started at Danieli in 1961 as a designer in the technical office for long product rolling mills. He advanced progressively to managing director in 1986 and become president and chief executive four years later. He had been chairman of the board since 2003 and chairman of the executive board since 2017, Kallanish notes.

The endless casting-rolling process conceived and developed by Benedetti is revolutionising long and flat production worldwide, in the most effective, competitive, green way, the Italian technology supplier says.

“While mourning this loss, the Danieli team is more determined than ever to pursue its leader’s vision, drawing inspiration from his teachings and guidance,” it concludes.

Adam Smith Poland

2023 was tough on steel producers, but 2024 will be even tougher, Celsa Group export director Alexander Gordienko said at the Irepas conference in Berlin on Monday, attended by Kallanish.

Noting that he does not expect demand to recover until 2025, Gordienko sees Chinese steel exports in 2024 reaching the record levels of 2015.

The Chinese government has started investigating possible fraud in non-VAT exports, Gordienko says, which he expects to slow exports only temporarily. He thinks China will find a way to continue shipping abroad, as exports are the major source of Chinese growth given its weak domestic market and struggling real estate sector.

Prices have trended mostly stable recently despite volatile raw material values and demand, Gordienko pointed out, as capacity utilisation rates are low. European GDP growth is expected to rebound from very low levels. Large European economies are underperforming while Greece and Spain are performing better than expected, Gordienko said.

Emerging markets are performing better, benefiting from the tensions between the US and China, Gordienko observed.

Global long steel consumption recorded a 5.3% decline in 2023, while Gordienko expects 2024 consumption to see a further 0.5% decline, which would mean another 12 million tonnes lost on-year. Wire rod consumption, which saw the steepest decline in 2023, is expected to fall by 8mt in 2024.

Meanwhile, Ulrich Leuchtmann from Commerzbank advised steel producers to be cautious with their investments amid low demand and a high inflation rate environment.

Burcak Alpman Turkey

kallanish.com

A steel producer in Northern Europe was said to be offering HRC at €650 ($695) per tonne ex-works on Monday, in contrast to the beginning of last week, when offer prices were mostly around €630-640 per tonne ex-works, sources told Fastmarkets.

And most market participants now expect the mills raise their offer prices again.

Last Friday, sources told Fastmarkets that one leading European steelmaker was planning to raise its offer prices by €30 per tonne for June-delivery material., with the news offers expected to be around €660-680 per tonne ex-works.

But there was no official confirmation about the price hike on Monday.

Northern European buyers, however, refrained from buying HRC, and no major deals were heard in the market.

Market participants estimated the tradable level for HRC in Northern Europe at €620-630 per tonne ex-works.

Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €629.58 on Monday, edging down by €0.84 per tonne from €630.42 per tonne on Friday.

The index was up by €4.16 per tonne week on week but down by €34.17 per tonne month on month.

In Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €625.00 per tonne on Monday, increasing by €4.37 per tonne from €620.63 per tonne on Friday.

The index was up by €5.83 per tonne week on week but down by €20 per tonne month on month.

Suppliers in Italy were offering HRC at €650-660 per tonne ex-works on Monday, sources told Fastmarkets. In contrast, in early April, the same material was offered at €630-640 per tonne ex-works.

But buyers remained reluctant to accept Monday’s level, and trading was limited.

And market participants estimated the tradable level at €620-630 per tonne ex-works.

Activity in the Italian market was slow at the end of last week due to public holidays in the country and a buyer source told Fastmarkets that this week and next would give a better indication of whether the new, higher prices would be accepted.

Two other buyer sources expressed skepticism, however, and pointed to the fact that real steel demand remains weak.

Among the reasons for the current attempt by mills to raise HRC prices was the increase in the price of Asian HRC being offered to Europe.

On Monday, HRC from Taiwan, Japan and India was on offer at €600-620 per tonne CFR Italy – slightly higher than last week’s €590-600 per tonne CFR, sources said.

Local mills were determined to increase their prices due to higher scrap prices in international markets and higher electricity prices, producer sources said.

But demand remained low, and both buyer and producer sources were unsure whether the uptrend would persist. According to market participants, some production cuts would be the best way to balance the market.

Rebar
After ArcelorMittal increased its prices for all long steel products across Europe by €20 ($21.43) per tonne during the Wire and Tube fair in Dusseldorf, other Polish producers also raised their offer prices.

This week, Polish mills offered rebar in the range of 2,650-2,700 zloty ($657-669) per tonne CPT, which nets back to about 2,630-2,670 zloty per tonne ex-works, sources told Fastmarkets.

This is 30-50 zloty per tonne higher than in the previous week, when offers from local mills were mainly in the range of 2,620-2,650 zloty per tonne CPT, equivalent to about 2,600-2,630 zloty per tonne ex-works.

But Fastmarkets’ sources said that 2,700 zloty per tonne CPT was not a tradeable price.

According to market participants, workable prices were in the range of 2,620-2,650 zloty per tonne CPT, equivalent to 2,600-2,630 zloty per tonne ex-works.

Based on sources’ estimates and increased offers from local mills, Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar) domestic, exw Poland was 2,600-2,650 zloty per tonne on Friday, widening upward by 20 zloty per tonne from 2,600-2,630 zloty per tonne on April 19.

Polish mills had sold good quantities at lower prices in previous weeks, so they could allow themselves to wait for buyers who would accept the new, higher prices, a distributor source told Fastmarkets.

“But no one is buying at 2,700 zloty per tonne CPT, which is indicative that this price is not workable,” the distributor source said.

A second distributor source expressed skepticism about whether the upward trend would last long.

“Mills will try to keep prices higher for two weeks, but when they see there is no demand, prices will drop again. Only the cut and bend companies have a lot of work in Poland,” the second distributor said.

Prices of imported rebar had also increased by about €10-15 per tonne this week, compared with the period before the Wire and Tube fair in Dusseldorf, sources told Fastmarkets.

For instance, imported rebar offers from Germany were heard at €640-647 per tonne delivered Poland.

Wire rod
At the beginning of the week, sources said that Polish mills had not yet announced their offers for May production of low-carbon drawing-quality wire rod.

On Friday, a consumer source reported an offer at 3,050 zloty per tonne CPT.

This was close to last week’s price range of 3,000-3,086 zloty per tonne CPT.

“Polish mills want to increase prices, and currently, there is no one selling at below 3,000 zloty per tonne CPT,” the consumer source told Fastmarkets.

Fastmarkets’ sources estimated tradeable prices in the range of 2,934-3,020 zloty per tonne CPT; no major deals were heard on the market.

As a result, Fastmarkets’ price assessment for steel wire rod (drawing quality), domestic, delivered Poland was 2,934-3,020 zloty per tonne on Friday, up by 70-134 zloty per tonne from 2,800-2,950 zloty per tonne on April 19.

“A price increase is necessary because scrap [prices have] recovered, and [it] seems [they] have found certain stability,” a second producer source said.

For instance, Fastmarkets’ daily index for steel scrap HMS 1&2 (80:20 mix) North Europe origin, cfr Turkey was calculated at $382.09 per tonne on Thursday April 25, its highest since April 3.

A similar trend was observed in Fastmarkets’ daily index for steel scrap HMS 1&2 (80:20 mix) US origin, cfr Turkey, which was calculated at $385.58 per tonne on Thursday, also its highest since April 3.

The second producer source added that the electricity day-ahead price in Poland surpassed €100 per MWh recently, which also affected production costs.

Published by: Darina Kahramanova

fastmarkets.com

A leading European steelmakers reportedly withdrew from the market at the end of the week to review their offer prices, Fastmarkets understands. But sources said they expect the mill to return with higher prices on Monday, with offers likely to be up by around €30 ($32) per tonne for June-delivery HRC.

“New offers [for HRC] will be set around €660-680 per tonne ex-works.,” a buyer in Europe told Fastmarkets. “We’ll then see if the market accepts [them], but there has been pressure [for higher prices] from the mills for about two weeks now – partially based on Asian prices rising.”

Other steelmakers are expected to follow suit, sources said.

Earlier this week, offers were reported at €630-640 per tonne ex-works from integrated mills in Northern Europe, while buyers estimated tradable prices at €620-630 per tonne ex-works.

Most market participants agreed that flat steel prices in Europe are likely to have hit rock bottom already, despite sluggish end-user demand, so mills are expected to push for higher prices.

“Trading is still weak, and volumes are not there yet, but the steel mills need better margins,” a source in the Benelux area said.

“I think there is room for some [HRC] price increases, but not a big one,” a buyer in Northern Europe said.

Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €630.42 ($675.63) per tonne on Friday, up by €5.04 per tonne from €625.38 on Thursday April 25.

The index was up by €4.92 per tonne week on week but down by €37.08 per tonne month on month.

In Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €620.63 per tonne on Friday, unchanged day on day.

The index was up by €0.63 per tonne week on week, but down by €31.04 per tonne month on month.

The domestic market in Italy was largely inactive on Friday due to a public holiday in the country.

Earlier this week, however, a domestic supplier increased its offer prices for HRC, but it was unclear whether buyers were willing to accept the higher offers, which came in at €660-670 per tonne delivered (equivalent to €650-660 per tonne ex-works), compared with €640-650 per tonne delivered (€630-640 per tonne ex-works) in early April.

This was also in stark contrast to the most recent transactions, which were heard at €620-630 per tonne ex-works.

Some sources pointed out that rising HRC import prices and restocking in mid-April were likely to have supported the bullish attempts by the steel mills.

But others were more cautious and said that a strong price rebound was unlikely in the near term because there was no support from real steel demand.

“In May, we will either see stabilization or a €10-15 per tonne rebound in a best-case scenario,” a source in Italy said. “The core problem is demand.”

In the week to Friday, offer prices for Asia-origin HRC for June shipment were reported at around €590-610 per tonne CFR, with the lower end only offered by Vietnamese mills.

Published by: Julia Bolotova

fastmarkets.com

Spanish car production suffered input material supply problems during March, Kallanish notes. The country saw a shortage of components at several plants, a consequence of the delays caused by the Red Sea shipping crisis. Production and exports also declined following lower demand during Easter.

Output in March was 195,252 units, compared to 227,923 vehicles in February and down 17.7% versus the same month in 2023. Three-month production amounted to 654,825 units, 0.5% less from January-March last year.

Meanwhile, Spanish vehicle exports slipped due to lower demand in markets outside Europe. Supplies were 174,138 units, a fall of 14.7% on-month and 16.8% weaker than in March 2023.

European markets had a 92.7% share in Spanish deliveries in March, down 0.5 percentage points on-month, but up 2.5pp on-year. Three-month exports declined 1.8% over the same period in 2023 to 579,988 vehicles, Anfac data show.

Todor Kirkov Bulgaria

kallanish.com

Ukraine has increased semi-finished products shipments to the EU amid the ongoing Russian invasion, Kallanish notes.

In January-February, the EU ramped up imports of semis from Ukraine by 21.6% on-year to 180,850 tonnes, according to Eurostat data.

The largest importers among the EU countries were Poland with 53,650t, less by 34.6%; Bulgaria with 40,050t, up 91%; Italy with 18,940t, up 89.5%; and Greece with 15,540t, up 155% on-year.

In February alone, the EU also increased imports of semis by 9% on-month and 6% on-year to 100,000t. The largest importers were Poland with 28,000t, up 9% on-month, Bulgaria with 38,000t, 25% more, and Italy with 13,200t, up 131%.

In 2023, the EU reduced imports of semi-finished products from Ukraine by 2.8% on-year 1.03 million tonnes. In monetary terms, intake decreased by 23% to $532 million.

Earlier, European steelmakers association Eurofer voiced concern over the European Commission’s decision to continue to allow Russian slab to enter the EU until 2028 (see Kallanish passim).

According to the latest decision, EU importers will be able to import some 3m t/year of slab from Russia until October 2026. The quota will then be reduced further to 2.6mt and then 2mt respectively during the following 12-month periods through October 2028.

Meanwhile, Russian billet imports into the EU will be prohibited from April 2024, as previously planned.

The EU reduced imports of semis from Russia in January-February to 474,600t, down by 11% on-year (see Kallanish passim).

In 2023, Russia’s steel and raw materials exports to the EU amounted to 4.8mt, down by 39.5% on-year, for €2.4 billion.

Svetoslav Abrossimov Bulgaria

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Tata Steel is proceeding with its single 3 million tonnes/year electric arc furnace plan for Port Talbot following seven months of formal and informal national level discussions with UK trade unions. Unions are gearing up for industrial action, Kallanish notes.

Port Talbot’s two blast furnaces, no.5 and no.4, will be closed by end-June and end-September respectively. Discussions will continue with unions during the next two weeks on a potential memorandum of understanding on the future ambitions of the business and the impact of the restructuring on employees, Tata says.

“We urge all our members in Tata Steel to vote ‘Yes’ and ‘Yes’ in our ongoing ballot for industrial action to help us negotiate an extension of blast furnace steelmaking at Port Talbot, secure the volume for downstream sites like Llanwern and Trostre, and guarantee there will be no compulsory redundancies,” says Community union general secretary Roy Rickhuss. The ballot result is expected on 9 May.

The Unite union says 1,500 members employed by Tata in Port Talbot and Llanwern have an industrial action mandate against plans to shut both blast furnaces, with strikes to be announced soon.

Tata has meanwhile begun preparations to place equipment orders for the EAF by September, begin enabling and preparatory works at the site by December, and based on current permitting timelines, begin construction on the project by August 2025.

The firm has accepted a revised and updated connection offer from the UK’s National Grid and will be finalising documents in the coming days. This will ensure it has the power infrastructure in place to commission the EAF on schedule by end-2027, it notes.

The steelmaker has already secured most of the slab and hot rolled coil substrate required during the transition period for the UK’s downstream mills. It has agreed details with Associated British Ports to expand the slab handling and stock holding capacity in the south Wales ports and is also in advanced discussions to have the rail movement capacity ready for onward transportation of substrate to the appropriate sites.

It adds it has agreed detailed terms with the UK government on the proposed grant package to support the £1.25 billion ($1.46 billion) EAF transformation, with final documents to be executed in the coming weeks.

“Having looked carefully at all the options over the past seven months in consultation with union representatives, we have decided to proceed with our proposed restructuring and transition. This is the most viable proposal, in contrast to the unions’ unaffordable plan which has high inherent operational and safety risk,” Tata says.

The company and the unions’ adviser reached a common conclusion that this plan would involve significant additional costs of at least £1.6 billion, it adds.

Tata Steel UK has had to supplement its own production with imported material of 333,000 tonnes during the last six months. In the 2023-24 fiscal year, the unit recorded a negative Ebitda of £373 million and negative free cashflow of £623m.

Adam Smith Poland

kallanish.com