Category: Latest Updates

Germany’s ThyssenKrupp Steel said March 1 that it has ordered a hydrogen-powered direct reduction plant from Dusseldorf-based engineer SMS to launch one of the world’s largest industrial decarbonization projects, set to eliminate more than 3.5 million mt/year of CO2 emissions.

SMS will carry out engineering, delivery and construction of the direct reduction plant at ThyssenKrupp’s Duisburg site in western Germany, along with two innovative smelters, and associated auxiliary units, in a Eur1.8 billion project that represents the largest single order in SMS’ 150-year history.

In total, ThyssenKrupp Steel has said it aims to reduce its CO2 emissions by 6 million mt/year — or 30% — by 2030.

At present, the Duisburg site emits over 17 million mt/year — and potentially up to 20 million mt/year — of CO2 because of its coal-powered hot iron production using blast furnaces, the company has said. It is responsible for 2.5% of Germany’s CO2 emissions, although installation of the first direct reduction plant will reduce the facility’s emissions by 20% or by 3.5 million mt/year.

The plant will have 2.5 million mt/year of direct-reduced iron (DRI) capacity and is set to come online by the end of 2026.

ThyssenKrupp said that the hydrogen-based direct reduction furnaces will offer a significant basis for manufacturing carbon-neutral steel in the future, adding that it plans to have completed its move into hydrogen-based steel production by 2045 at the latest.

— Ekaterina Bouckley

Spanish stainless steel group Acerinox’s melting shop production fell 37% year on year to 397,000 mt in the fourth quarter of 2022 amid low apparent demand and inventory adjustments, it said late Feb. 28.

For the full year production was down 16% at 2.2 million mt.

Q4 volume from its cold-rolling operations was 247,000 mt, down 42% year on year, with the full year volume down 11% at 1.4 million mt.

Longs production was down 24% year on year at 48,000 mt in Q4, with full year volume down 5% at 232,000 mt.

The company operates plants in Spain, the US, South Africa and Malaysia with a combined melt shop capacity of 4.5 million mt/year, as well as production facilities for high performance alloys in Germany.

It did not provide production figures for individual plants.

Platts, part of S&P Global Commodity Insights, assessed hot-rolled coil prices in Northwest Europe up Eur10/mt on the day to Eur805/mt ex-works Ruhr Feb. 28.

From the third quarter onwards, production had been adapted to the needs of the market, Acerinox said. It also carried out maintenance at the melting shop and hot rolling lines in Spain, the melting shop in South Africa and its hot rolling in the US.

In Europe, actual demand declined due to the uncertainties arising from the invasion of Ukraine, which resulted in inventories closing above the average of recent years.

The company said it booked a Eur98 million ($104 million) inventory adjustment at year-end to bring its European inventories in line with the price situation of that market.

Cost inflation, especially energy costs, dented competitiveness in Europe, especially in Spain, it said, while imports into the region remained at high levels at the end of the year, largely due to the price spread with Asia.

The company also booked a Eur204 million impairment at re-roller Bahru Stainless in Malaysia due to weak demand in the Asian market amid oversupply and aggressive pricing strategies by other producers, it said.

The company said it currently expected the dynamics of H2 2022 to continue, with the apparent consumption improving, although still slow.

The North American market was the best performer, it said.

The company’s US unit, Kentucky-based North American Stainless plans to increase production capacity by 20% to 200,000 mt/year with an investment of $244 million to install new cold rolling trains and upgrade its annealing and pickling lines.

— Gianluca Baratti

The European longs market was expecting higher price movements on the back of energy and scrap costs and limited import availability for rebar, but the market still had yet to absorb higher offers, sources said March 1.

Several sources said that one mill that had been out of the market over the last week had increased their offer prices by Eur30/mt on March 1 based on energy and higher scrap costs.

“Some mills are catching up so I wouldn’t really see it as a price increase,” a Southern Europe-based producer said. “It is still not clear where the market is, we have to see next week.”

The producer reported a workable level of Eur960-Eur970/mt delivered Northwest Europe for medium sections category 1, adding prices at Eur940/mt were not achievable anymore.

A Benelux-based distributor put workable levels for medium sections category 1 at Eur950-Eur960/delivered Northwest Europe.

A Benelux-based trader said that for rebar, customers were not in immediate need for booking material due to restocking in late 2022 and early 2023. He put offer prices from European mills at Eur710-Eur715/mt delivered Northwest Europe, with some room for negotiation.

Sources said due to the current focus of Turkish mills on the domestic rebar market, import volumes to Europe were expected to be low this year, supporting European mills’ prices on top of increasing scrap costs, while energy costs would remain high.

A Europe-based mill source said they would need to pass on higher production costs to customers, and that prices in Northwest Europe had been subdued for some time.

Platts assessed the weekly assessment for rebar at Eur705/mt EXW Northwest Europe March 1, stable on the week. The weekly medium sections assessment moved up Eur5 on the week to Eur945-Eur955/mt delivered Europe.

Platts is part of S&P Global Commodity Insights.

— Laura Varriale

European domestic prices for hot-rolled coil are expected to gradually rise as buyers expect to start restocking soon, sources said March 1.

ArcelorMittal has increased its coil offers by Eur20/mt across Europe. New offers for HRC in Germany reached Eur840/mt ex-works Ruhr and in Italy, at Eur820/mt delivered.

The positive mood in the market has been supported by a combination of good order books from the mills, a lack of competitive import offers, and an anticipated rise in demand.

The majority of the European steelmakers have already been offering May shipment HRC. The scheduled restart of some idled furnaces in March-April will not have an immediate impact on supply and prices, sources said.

Import offers have been available only for material from Asia with delivery in July-August, making more buyers turn toward European mills for orders.

“Only import you can get is from Asia and the lead times are long,” an Italian service center said. “Turkey is not exporting and will not export for quite some time after the earthquake. So buyers will focus on domestic purchases and would book limited volumes from overseas.”

Demand from end consumers has remained stable and a significant increase is unlikely in current economic conditions, according to the estimations of market sources. Distributors, however, have lower stocks of flat steel products and they would need to return to the market looking for orders soon.

“Now we do not have many orders, but it seems that the buyers would need to restock in a couple of weeks and then the prices will rise,” a European steelmaker said.

Platts assessed domestic HRC prices in Northwest Europe at Eur805/mt EXW Ruhr March 1, unchanged.

The assessment was based on deals reported around Eur800/mt EXW Ruhr, tradable values heard at Eur800-820/mt EXW Ruhr, and offers at Eur820-840/mt EXW Ruhr.

In Southern Europe, Platts assessed domestic prices for HRC at Eur785/mt EXW Italy March 1, up Eur5 on the day.

Transactions and tradable values have been reported at Eur780-790/mt EXW Italy and offers at Eur800-820/mt EXW Ruhr.

The number of import offers has been limited, exporters from Asia are expected to return to the EU market with higher offers next week.

Offers of HRC from India have been heard at Eur740/mt CIF Italy and from the Far East at Eur750-760/mt CIF Italy.

Platts is part of S&P Global Commodity Insights.

— Maria Tanatar

Tata Steel Nederland has reached agreements with Germany’s Wuppermann, Bilstein, EMW Stahl Service, and with Spain’s Arania to supply them with its Zeremis Carbon Lite steel starting 2023.

The four customer companies supply major players in the automotive and industrial markets.
Tata’s Zeremis brand for steel with an allocated carbon footprint reduction of up to 90% for the sum of Scope 1, 2 and 3 emissions was launched last year. In October, Tata signed a supply deal for Zeremis with carmaker Ford.

The new deals this week were signed with long-standing customers, with whom Tata Steel Nederland has held an open discussion to reduce their Scope-3 emissions and create shared sustainability strategies, Kallanish understands. “We can already supply them a significant amount of high-quality low-CO2 steel now, and we aim to offer large quantities of high-quality green steel by 2030,” says Hans van den Berg, chief executive of Tata Steel Nederland. By 2030, the steelmaker is targeting to commission its first direct reduction plants and electric arc furnaces at the IJmuiden site.

According to Tata Steel Nederland, Zeremis’s lower CO2 intensity is based on CO2 savings realised within its steelmaking process. and is verified by independent assurance expert DNV. Additional Zeremis green steel products will follow in the near future; for example, Zeremis products with increased recycled content, it says.

Christian Koehl Germany

Montenegro state-owned power company Elektroprivreda Crne Gore (EPCG) is preparing to start production at its newly acquired Zeljezara Niksic plant, Kallanish notes.

Last week, EPCG president Milutin Đukanovic reiterated there is a business plan for Zeljezara Niksic, which foresees that 300 workers will be hired at first. He also however pointed out he will not be satisfied until there are 1,000 workers at the plant.

“We have often said that Zeljezara is the soul of Niksic, but when we put these emotional components aside, this property is worth €54 million ($57m) according to the last estimate, and we paid €20m for it,” he noted during the mill’s reopening ceremony. Production will resume shortly, he added.

“I am extremely proud that we have removed the chains from the gates of Zeljezara and that we are returning the plant to the path of glory,” noted Montenegro Prime Minister Dritan Abazovic.

In January, EPCG concluded the purchase of Zeljezara Niksic plant from Tosyali Holding (see Kallanish passim).

According to EPCG, it will transfer to a newly formed subsidiary the property acquired through the purchase agreement. Its aim is to provide additional support for the development of solar and other types of renewable energy sources, which represent the future of the Montenegrin energy sector.

The business plan foresees the new company will consist of several production units – solar, substructure and construction.

Tosyali acquired Zeljezara Niksic in 2012 for €15.1m at a public auction. The company then invested in the plant to improve and modernise production technology, and achieve high product quality.

However, in early 2021, the plant suspended production due to falling orders caused by the Covid-19 pandemic, leading to Tosyali’s decision to sell the unit.

Niksic specialises in the production of alloy and non-alloy steel, roller bearing tool steel and heat-resistant steel.

Svetoslav Abrossimov Bulgaria

Germany’s steel and metals working industries are looking back at weakening performance in 2022, and hope that in 2023 national politics will become friendlier towards manufacturing industries.

Production of fabricators in 2022 fell by 0.3% year-on-year, according to their federation WSM.

Although the fourth quarter was slightly better overall than Q4 2021, the increase of 0.9% is only meagre. On top of that, the trend points downwards, WSM notes. Production lost 3.4% in Q4 2022 compared to Q3. “We need decisions now that support growth forces, not slow them down. 2023, the ‘Year of Industry’, needs an avowed ‘yes’ to Germany and Europe as a business location – as a prelude to a long-term industrial policy,” says WSM economist Holger Ade.

In a separate statement, the federation bemoans the state of infrastructure, especially for transportation. “Blocked bridges, miserable roads, inadequate connections – things are not running smoothly on Germany’s routes. We urgently need renovation and rapid road expansion, so that companies can be reached without problems,” Kallanish hears from WSM managing director Christian Vietmeyer.

A defective transport network also endangers climate and sustainability goals, WSM underlines. Every kilometre of diversions increases fuel consumption and emissions. The desired circular economy comes to a standstill when companies are no longer accessible for waste management companies, it says.

Christian Koehl Germany

Italian steelmaker Acciaierie d’Italia (ADI), the joint venture between state company Invitalia and ArcelorMittal, is to extend its temporary layoffs until June for up to 3,000 workers mainly at its Taranto steelworks, sources close to the company confirm to Kallanish.

This extends the current layoff scheme at Taranto, previously set to expire on 27 March, where about 2,500 workers will be affected. The remaining workers will be laid off at the Racconigi, Genoa and Novi Ligure sites.

In a document sent to unions, the company says it is planning the reconstruction of blast furnace no.5 which has been idle for several years, together with an electric arc furnace. This year, the steelmaker has vowed to produce about 11,000 tonnes/day of pig iron, or 4 million tonnes/year, using between two and three blast furnaces. This compares to an average of 20,000 t/d that could be produced without layoffs, the document says.

Last month, the Italian finance ministry (Mef) officially authorised the payment of €680 million ($718m) to Acciaierie d’Italia. In 2023, the plant in Genoa will benefit from a revamping of the tinplate re-rolling lines, while Novi Ligure will see a revamp of the coating line. ADI will also boost the Racconigi warehouses’ automation (see Kallanish passim).

Acciaierie d’Italia employs over 10,000 workers. It is currently operating with BFs no.1 and no.4, while BF no.2 remains idle.

Natalia Capra France

European scrap prices will increase in March. With Turkish demand strong, merchants in France, Italy, Germany and Eastern Europe are expected to ask for some €30/tonne ($31.7) increase, although it is still too early to be sure, Kallanish hears.

In some Eastern European countries such as Romania, sellers are seen asking for as much as $50/t increases month-on-month, although some sources consider these levels an exaggeration. In Poland, it is still early to quantify March hikes, but two sources believe they will be in the range of €20-30/t.

In Germany and Italy, mills have already granted €10/t increases for contracts with prompt delivery within the first week of March. This has pushed E8 mixed grade in these two countries to €390-400/t delivered and E1 to €360/t delivered.

In Italy, mills are cautious over increases but are looking for material. Rebar, merchant bar and wire rod markets in Western Europe continue to be affected by low sales. Some mills will implement production cuts in March, which should cause scrap demand from these producers to lower. Flats and specialty steel producers however will buy high scrap volumes thanks to their filled order books.

Natalia Capra France

Tata Steel Nederland has reached agreements to supply its low carbon product Zeremis Carbon Lite to a number of steel-processing companies, it said Feb. 28.

The steelmaker has signed agreements with sustainable steel belt and tube producer Wuppermann, shock absorbers and suspension system manufacturer BILSTEIN, German steel distributor EMW Stahl Service and southern European cold rolled high and low carbon steel maker Arania.

Tata has been supplying Zeremis Carbon Lite, which has an allocated carbon footprint reduction of up to 90%, since last July.

It plans to introduce additional Zeremis low carbon steel products, such as Zeremis products with increased recycled content.

“The use of lower CO2 steel by these steel processors, who supply major players in the automotive and industrial markets, enables their customers to make greener end-products such as kitchens, robotic storage systems and passenger cars,” Tata said.

“Over the years, we have developed a collaboration with Wuppermann, BILSTEIN, EMW Stahl Service and Arania that allowed for open discussion on ways to further reduce their scope-3 emissions and create shared sustainability strategies,” Tata Steel Nederland CEO Hans van den Berg said.

“We can already supply them a significant amount of high-quality low-CO2 steel now, and we aim to offer large quantities of high-quality green steel by 2030, when we target to commission our first direct reduction plants and electric furnaces at our IJmuiden site.”

Currently, the CO2 intensity of the steel produced in IJmuiden is around 7% below the European average and 19% below the global average, and set to fall further once it is converted to using green hydrogen-based steelmaking.

Tata Steel Nederland aims to reduce its CO2 emissions by 35%-40% by 2030 and to be carbon neutral by 2045.

Last August, Tata Steel Nederland signed contracts with three companies to advance technical preparations for the use of hydrogen in steelmaking at Ijmuiden.

Tata also previously signed an agreement with the national grid operator TenneT for a direct connection to the national electricity grid to be able to use green energy for future operations.

Platts, part of S&P Global Commodity Insights, assessed domestic HRC prices in Northern Europe at Eur795/mt ($843/mt) ex-works Ruhr Feb. 27, up 16% since the start of 2023.

— Jacqueline Holman