Northern European steel longs prices stable amid slow consumption
Higher input costs and weak economic conditions resulted in little movement in the market, sources said.
Carnival holidays in the Netherlands on February 11-13 further compounded the quietness in the market, Fastmarkets understands.
But producers remained firm on current offers, given higher input costs, sources said.
Fastmarkets’ price assessment for steel reinforcing bar (rebar) domestic, delivered Northern Europe was €650-660 ($697-707) per tonne on Wednesday, widening downward by €5 per tonne week on week from €655-660 per tonne.
Market participants reported a dead market and did not expect an upturn in demand in the short term.
“The market is dead, and nothing is happening, especially with holidays over the past week across the Netherlands,” a buyer source said.
“The market has not moved week on week,” a second buyer source said.
Fastmarkets’ price assessment for steel wire rod (mesh quality) domestic, delivered Northern Europe was €650-660 per tonne on Wednesday, stable week on week.
Meanwhile, international prices for heavy melting scrap (HMS) have remained high since the beginning of February.
Fastmarkets’ calculation of its daily index for steel scrap HMS 1&2 (80:20 mix) North Europe origin, cfr Turkey was $416.02 per tonne on Wednesday, down by $1.72 per tonne week on week from $417.74 per tonne.
Published by: India-Inés Levy
Europe steel hollow sections prices stable, HRC feedstock costs decline
Prices have been flat in the past few weeks, with sentiment depressed due to slow consumption from the construction sector, according to sources.
Fastmarkets’ weekly price assessment for steel sections (medium) domestic, delivered Northern Europe was €820-890 ($879-954) per tonne on Wednesday, unchanged since January 24.
Fastmarkets’ weekly price assessment for steel sections (medium) domestic, delivered Southern Europe was €820-890 per tonne on Wednesday, also flat since January 24.
Meanwhile, hot-rolled coil feedstock costs in Europe fell in the past seven days amid slow finished steel sales.
Fastmarkets’ daily calculation of its steel hot-rolled coil index domestic, exw Northern Europe was €746 per tonne on Wednesday, down €9.38 per tonne from €755.38 per tonne a week earlier, but up by €14.75 per tonne month on month.
Published by: Holly Chant
European HRC prices slide further in bearish market
Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe at €737.60 ($790.33) per tonne on Thursday, down by €8.40 per tonne from €746.00 on Wednesday.
The index was down by €17.19 per tonne week on week but up by €6.35 per tonne month on month.
Offers from integrated producers in the region were heard at €740-760 per tonne ex-works for HRC with April lead times. But sources pointed out that steelmakers were ready to give a discount of €10-20 per tonne on firm bids.
“Order books at mills are not so full for the second quarter, plus we had a few blast furnaces back online in January, so availability [of HRC] is expected to improve — while demand, not so much,” a buyer source in Northern Europe told Fastmarkets.
In January, several European steelmakers restarted capacities that were idled in 2023 because of low demand or due to maintenance needs, Fastmarkets reported.
In Germany, transactions were reported at €725-740 per tonne ex-works in the week from Monday February 12.
One re-roller in Benelux has reportedly sold an HRC cargo to Germany at €710 per tonne ex-works. However, this was not widely confirmed by the market before the publication deadline.
Italy-origin coil was heard offered to Germany at €755 per tonne delivered.
Despite substantial price drops since the beginning of February, trading in Northern Europe remained sluggish because buyers expected the downtrend to persist throughout February and into March, Fastmarkets understands.
“Mills failed to get higher prices for second-quarter [delivery] orders,” a buyer in Germany said. “There are no positive changes from the demand side — that’s the key problem.”
“Of course, everyone wants to restock at rock bottom [prices]. Despite price drops, we still only see low-tonnage sales here and there, no restocking,” a mill source in the region said.
Mill sources and some buyers said they did not expect HRC prices to drop below €700 per tonne ex-works due to production costs and reduced price pressure from imports.
“Uncertainty over safeguards, CBAM [the Carbon Border Adjustment Mechanism] and long lead times make imports unattractive to many buyers, despite lower prices. Buyers who wait too long to restock will have no other option but to book with European mills and pay European prices,” a steel-service center source in Germany said.
Fastmarkets calculated its daily steel HRC index, domestic, exw Italy at €730.83 per tonne on Wednesday, down by €4.80 per tonne from €735.63 per tonne on Tuesday February 13.
The index was down by €19.70 per tonne week on week but up by €8.33 per tonne month on month.
Offers of April-delivery HRC from domestic suppliers were reported around €750 per tonne delivered (€735-740 per tonne ex-works).
Buyers estimated achievable values for April-delivery HRC at €720-740 per tonne ex-works.
Trading remained sluggish in the domestic market because buyers have been keeping to the sidelines and not restocking, Fastmarkets understands.
In the secondary market, 4mm HR sheet was heard trading no higher than €820-830 per tonne CPT; sources said that achieving higher prices “was extremely difficult” due to poor demand.
No new import offers were reported due to the Lunar New Year in Asia.
Published by: Julia Bolotova
EC approves €6.9 billion state aid for H2 infrastructure
The European Commission approved on Thursday €6.9 billion ($7.4 billion) in state aid funding for hydrogen infrastructure-related projects in seven EU countries, Kallanish reports.
The so-called IPCEI Hy2Infra scheme was planned by France, Germany, Italy, the Netherlands, Poland, Portugal and Slovakia. It awards 32 companies, including five SMEs, and 33 projects in areas of electrolysis, pipelines, storage and handling terminals.
“While the renewable hydrogen supply chain in Europe is still in a nascent phase, Hy2Infra will deploy the initial building blocks of an integrated and open renewable hydrogen network,” comments Margrethe Vestager, EC vice president in charge of competition policy. “This IPCEI will establish the first regional infrastructure clusters in several member states and prepare the ground for future interconnections across Europe, in line with the European Hydrogen Strategy.”
The public funding is expected to unlock another €5.4 billion in private investments. The projects cover the deployment of around 3.2 gigawatts of electrolyser capacity; construction of 2,700 kilometres of transmission and distribution pipelines; development of 370 gigawatt-hours of hydrogen storage capacity; and construction of handling terminals and port infrastructure to handle 6,000 tonnes/year of liquid organic hydrogen carriers (LOHC).
The electrolysers should be operational between 2026 and 2028, and the pipelines between 2027 and 2029. The timelines will vary depending on locations, projects and companies, but the EC expects overall completion in 2029.
According to the awards list seen by Kallanish, the majority of projects are based in Germany (24). The country had project approvals in all four Hy2Infra workstreams, with 10 for electrolysers and nine for pipelines. Some of the companies granted support include Air Liquide, EWE Hydrogen, Linde, Lingen, Thyssengas, Gasunie, AquaDuctus, VNG and Hydrogenious.
The West Germany cluster, for instance, will have three electrolysers built in the Rhine-Ruhr area. It will be connected to three different pipeline projects and have access to a storage facility. According to Vestager, by mid-2027, the renewable hydrogen produced in the cluster will be supplied to companies operating in the steel, cement, chemical, refining, and mobility sectors. The cluster will also connect to the Dutch national hydrogen network, she notes.
“For a successful roll-out of renewable and low-carbon hydrogen, all pieces of the puzzle need to come together,” adds commissioner Thierry Breton.
The EU has previously approved two other Important Project of Common European Interest (IPCEI) state aid schemes – the Hy2Tech in July 2022 and the Hy2Use in September 2022.
France, Germany, Poland and Portugal included their participation in their Recovery and Resilience Plans, thus can partially fund some of their projects through the Recovery and Resilience Facility. The amount granted to each company and project will be made public by the EC later, once any confidential business secrets are removed from the EC’s decision documents.
Prices for European CRC, HDG slide on weak demand
For cold-rolled coil, producers were avoiding giving firm offers, because they were unable to compete with much cheaper imports, several sources said.
“Energy costs remain quite high again across Europe, and annealing [the heat treatment procedure for CRC production] is very energy-intensive,” a mill source in Europe said.
“CRC is normally a product coming from Northern EU mills to Italy and [Northern EU mills] are not interested in supplying Southern EU/Italy at competitive prices,” a distributor said.
Buyers estimated tradable prices for CRC in Southern Europe at €800-820 ($860-881) per tonne ex-works.
Offers were reported around €840-850 per tonne delivered (€825-835 per tonne ex-works).
As a result, Fastmarkets’ price assessment for steel cold-rolled coil domestic, ex-works Southern Europe was €810-825 per tonne on Wednesday, down by €15-20 per tonne week on week from €830-840 per tonne.
Sources said that competitive offers from overseas suppliers were also dragging European prices downward. Transaction for South Korea- and Taiwan-origin CRC with April shipment was reported at €740-750 per tonne CFR to Southern Europe in early February.
During the assessment week, the import market was quiet due to Lunar New Year celebrations in Asia.
HDG
Competition from imports was less intense in HDG market because overseas mills were unable to supply the full range of grades and dimensions required by European buyers, Fastmarkets understands.
However, slow real demand was pushing prices down, source said.
Southern European producers were heard to have reduced offer prices to €850-860 per tonne per tonne ex-works for HDG, in comparison with the €880 per tonne ex-works reported in January.
Most suppliers could still offer April-delivery HDG, which indicated weak order books, sources suggested.
Buyer’s estimation of tradeable values for HDG was no higher than €860-870 base delivered (€845-855 per tonne ex-works)
As a result, Fastmarkets’ price assessment for steel hot-dipped galvanized coil domestic, ex-works Southern Europe was €845-855 per tonne on Wednesday, down by €15 per tonne from €860-870 per tonne seven days ago.
Overseas HDG offers to Europe were rare due to Lunar New Year celebrations in Asia.
The most recent offers from Vietnamese suppliers for 0.5mm HDG with Z100 coating were said to be aiming for $880-890 per tonne CFR to Southern
Europe. However, due to a persistent downtrend in global HRC markets, most sources expect Vietnamese suppliers to return with lower offers next week.
European HRC prices under pressure from low demand
Trading in the spot HRC market remained weak in Northern Europe, with transactions mainly heard done for limited volumes.
“There is no restocking; everyone buys only what they absolutely have to,” a mill source in the region said.
“The price tendency is going down. It started [during the week to February 9] and mills are still looking for orders for the second quarter, but [real] demand is still very weak,” a trading source told Fastmarkets.
Offer prices for April-delivery HRC were reported at €740-760 ($795-816) per tonne ex-works from integrated mills in the region.
Buyer estimates of tradeable values were no higher than €730-750 per tonne ex-works.
Two sources reported sales of Germany-origin coil at €720-730 per tonne ex-works on Tuesday, but it was not widely confirmed at the time of publication.
Italy-origin coil of March rolling was said to be offered at €760 per tonne ex-works in Germany.
Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe at €746.00 per tonne on Wednesday, down by €1.50 per tonne from €747.50 on Tuesday.
The index was down by €9.38 per tonne week on week, but up by €14.12 per tonne month on month.
Fastmarkets calculated its corresponding daily steel HRC index, domestic, exw Italy at €735.63 per tonne on Wednesday, down by €8.12 per tonne from €743.75 per tonne on Tuesday.
The index was down by €17.12 per tonne week on week, but up by €13.96 per tonne month on month.
Italian mills have reduced HRC prices to fill order books for second-quarter delivery, but sales remained slow.
Offers were reported at around €750-760 per tonne delivered from local suppliers for April-delivery HRC.
“Real demand is still weak and prices [for processed coil] in the secondary market are not increasing,” a buyer in Italy said.
Buyers estimated achievable values for April-delivery HRC at €740-750 per tonne delivered (€725-735 per tonne ex-works) compared with €760-770 per tonne delivered (€745-755 per tonne ex-works) achieved for March delivery.
Despite the price declines, trading remained dull in the local market with buyers keeping to the sidelines and not restocking, citing “very slow sales downstream.”
In the secondary market, 4mm HR sheet was traded no higher than €820-830 per tonne CPT.
Meanwhile, imports were quiet due to the Lunar New Year in Asia.
Offers from India were heard at €670 per tonne CFR on Wednesday.
Offers from Japan and Egypt came in at €640-650 per tonne CFR, sources said, while those from Vietnam were heard at €630 per tonne CFR.
Most overseas suppliers were already offering April-shipment cargoes.
Despite the downtrend in the import coil segment and the increasing gap between European and import HRC, most sources agreed that pressure from imports was minimal so far.
“Importing coil is complicated due to fast-depleting quotas, logistics issues caused by uncertainty in the Red Sea and longer lead times. Big companies who traditionally rely on imports will keep booking [imports] no matter what, while those who need quicker shipment will have no alternatives but the EU mills,” a buyer in Italy said.
Published by: Julia Bolotova
UK could follow EU safeguarding measures on China-made EVs
The UK’s Trade Remedies Authority (TRA), a post-Brexit trade watchdog, says it would be ready to implement an investigation on Chinese electric vehicle imports if the government required it to do so.
Oliver Griffiths, ceo of TRA, told the Guardian neither the government nor carmakers have requested such a move yet, though they are closely watching market developments. “We’ve been in close and regular contact with the industry on this one, and lots of people are looking at the import numbers… All eyes will be on Brussels later on this year when they could potentially bring out an interim measure on this,” he says.
Last year, the European Commission announced it would be probing China-made electric vehicles entering its borders due to heavy subsidies and competition distortion. Then, EC President Ursula von der Leyen said the investigation seeks to defend the EU against “unfair practices,” de-risking, not decoupling from China. The probe reportedly started in October on BYD, Geely and SAIC, but is also set to cover European carmakers with production capacity in China.
The EU remains the UK’s biggest automotive trade partner and vice-versa. According to the latest trade report from the UK automotive association SMMT, China was the second largest supplier of cars to the UK in 2022, with a 9.2% share of its total imports (including both EV and ICE cars). Most of the car imports (71.3%) came from the EU.
According to Sam Lowe, partner and trade expert at Flint Global, if and when the EU introduces new countervailing tariffs on China-originating EVs, “the UK will come under a lot more pressure to do the same.”
“Where the EU moves, the UK usually follows,” he adds in a note seen by Kallanish. “While the UK government and industry are currently publicly reluctant to replicate the EU measures, this will probably change once China-originating cars originally destined for the EU turn up in observable quantities on British driveways.”
The EU is among one of the most open markets for Chinese firms trying to get a footprint abroad, Lowe notes. That’s because, with a 10% tariff, it’s relatively more attractive to Chinese car exporters than the US and Turkey, where import tariffs stand at 27.5% and 50%, respectively.
Sunfire installs 20-MW electrolysis plant in Finland
German electrolyser manufacturer Sunfire says it has installed Finland’s first industrial-scale electrolysis plant in Harjavalta, with green hydrogen production anticipated to start later this year.
The 20-megawatt pressurised alkaline electrolyser is installed at Finnish green hydrogen developer P2X Solution’s hydrogen plant in western Finland. The project started construction a year ago. At full capacity, the plant will produce 400 kilograms/hour of green hydrogen using wind energy. It will be commissioned in the coming months, according to Sunfire.
The project also has a methanisation plant, which will produce “renewable synthetic methane” from carbon dioxide and green hydrogen, Kallanish learns from a statement.
P2X signed an offtake agreement with Danisco Sweeteners, a unit of US-based International Flavors & Fragrances, for green hydrogen produced from the plant last November. The company will use the green hydrogen at its plant in Kotka, Finland, to reduce carbon emissions during the production of xylitol, a synthesised sugar alternative used in the food industry.
P2X is targeting a total capacity of 1 gigawatt for green hydrogen production by 2031.
“Green hydrogen will play a crucial role in the transformation of the chemical sector,” says Sunfire ceo, Nils Aldag. “We feel privileged to be part of this pioneering project with P2X Solutions, where our pressurised alkaline electrolyser will be operated on an industrial scale. I am especially pleased that our ‘Made in Europe’ electrolysis technology will contribute to Finnish energy history.”
The project has an estimated total investment of €70 million ($75.4m). Of this, €36m was provided by the Finnish government’s Ministry of Economic Affairs and Employment and the Finnish Climate Fund.
Based in Dresden, Germany, Sunfire develops and manufactures electrolysers based on solid oxide electrolyser cell (SOEC) and alkaline technologies. Last September, German energy developer RWE produced the first green hydrogen at its gas-fired power plant in Emsland, Germany, using a 250-kilowatt (kW) SOEC supplied by Sunfire.
Early last year, the company also began the series production of alkaline electrolysers at its Solingen site in Germany.
Reliance agrees to acquire American Alloy Steel
Reliance Steel and Aluminum has agreed to acquire Houston, Texas-based plate and bar distributor American Alloy Steel, Kallanish understands.
The acquisition will increase Reliance’s value-added processing capabilities in burning, cutting, rolling and beveling, the Scottsdale, Arizona-based company states.
“We look forward to continuing to grow the American Alloy business, especially in value-added processing, as well as leveraging our collaboration efforts to expand the product and service offerings of both American Alloy and our existing Reliance companies as they find opportunities to work together and grow,” says Reliance ceo Karla Lewis.
The sale price was not disclosed. Reliance says the transaction includes all related real estate assets and outstanding equity interests of American Alloy Steel, which had 2023 net sales of approximately $310 million.
The transaction is expected to be completed within 60 days, pending customary closing procedures and regulatory review. American Alloy’s team, including management, is expected to remain in place through the transition.
American Alloy Steel is a leading distributor of specialty carbon and alloy steel plates and round bars, including pressure vessel quality material. The company operates five service centres in the US, a US-based plate fabrication business, and a joint venture in Canada. In addition to its customers across North America, American Alloy serves international markets for military, infrastructure, power generation, utility, refining, petrochemical, mining, shipbuilding and marine application industries.
Kristen DiLandro USA
Europe’s automotive segment fails to strengthen: thyssenkrupp
The steel divisions of Germany’s thyssenkrupp AG (tk) may reduce output slightly in the face of potentially weaker orders but the company does not expect to idle capacity.
In reporting fiscal first quarter earnings, cfo Klaus Keysberg notes that the company does not expect increasing dynamics from the automotive industry in the months ahead, at least not in Europe. A “gap compared to pre-crisis levels” will prevail, Kallanish hears him say in the earnings conference call.
For the current prospects of capacity utilisation of tk’s mills, Keysberg notes that the mills’ steel output can be reduced only within limits, but that the company will not stop any blast furnace.
In the quarter ended 31 December, thyssenkrupp conceded sinking revenues and orders and diverging impact from automotive customers.
At the group’s steelmaking unit, tk Steel Europe, the figure of €2.4 billion ($2.6 billion) for both order intake and revenues was below the prior-year quarter’s of €3 billion, also for both indicators. This was due especially to strong price declines. Whereas shipment volumes were stable compared with the prior year, at some 1.9 million tonnes, order volumes decreased slightly to 2.1mt mainly driven by lower demand from automotive customers.
Against that, at the group’s distribution division, tk Materials Services, the business with automotive customers through its service centres provided some stability. The division overall still reported declining results, at €2.9 billion for both order intake and sales, down 17% and 21% year-on-year, respectively. The division saw lower prices especially for finished steel and stainless steel, and lower demand in Europe.
However, significantly positive earnings contributions were delivered by the service centres, Aerospace and the direct-to-customer business.
Keysberg notes that the positive service centre operations were mainly achieved in the North American units. Shipment of materials and raw materials at tk Materials Services versus the prior-year-quarter went down from 2.1mt to 1.8mt.
Christian Koehl Germany