Category: Latest Updates

European cold-rolled and hot-dipped galvanized coil producers were aiming for higher prices in the week to Wednesday January 25, but buyers showed resistance, market sources told Fastmarkets.
Bullish sentiment arising from strong order books and high costs has caused European flat steel producers to gradually push for higher CRC and HDG prices.

Buyers, however, were skeptical about another round of price increases, citing insufficient demand from end users.

Notably, CRC offer prices were heard at €880-900 ($959-980) per tonne EXW, while HDG offer prices were reported at €900-930 per tonne EXW for April delivery.

Most buyers in Northern Europe said the tradable value for CRC was €830-850 per tonne EXW, although some bids still came in at €810 per tonne EXW in the week to Wednesday.

Trading was rather slow during the past week due to buyers holding back and assessing the new offers, while steel mills still had good order books and were in no rush to seek out new business, sources said.

Fastmarkets’ weekly price assessment for steel CRC domestic, exw Northern Europe was €830-850 per tonne on Wednesday, up by €10-20 per tonne from €820-830 per tonne on January 18.

Fastmarkets’ corresponding weekly price assessment for steel HDG domestic, exw Northern Europe was €840-850 per tonne on Wednesday, up by €10 per tonne from €830-840 per tonne on January 18.

The assessment was a reflection of offers and estimates of achievable prices made in the week to Wednesday.

Overseas CRC and HDG suppliers were mostly out of the market in the week to Wednesday and were expected to return with higher offers after the Lunar New Year holiday in Asia.

Published by: Julia Bolotova

Global investment in low-carbon hydrogen more than tripled in 2022 to a record $1.2 billion, according to a report released on Thursday by research firm BNEF.

The investments cover electrolysis and thermochemical production projects, as well as pipelines and underground storage, Kallanish notes. However, 99% of last year’s spending went towards electrolysers, with electrolysis capacity surging to 1.2 gigawatts from less than 0.5GW in 2021.

Although Europe is believed to be at the forefront of hydrogen technology and development, investment in the region was behind the levels registered in the US and China. The former topped electrolyser spending, with the commissioning of 290 megawatts of electrolysis capacity. China commissioned 724MW of additional capacity last year, but investment was lower than in the US because Chinese electrolysers are roughly 70% cheaper than those sold elsewhere.

BNEF researchers suggest Europe’s low investment levels are mostly due to project delays, as investors waited for more clarity over hydrogen standards and subsidies. It is unclear whether the US’s Inflation Reduction Act legislation, which offers up to $3 in tax credits per kg of green hydrogen production in the country, has negatively impacted European investment in 2022.

Hydrogen had the highest growth in investment among energy transition sectors, but only accounted for 0.1% of the $1.1 trillion spent in other areas including renewables and electrified transport.

Gabriela Farhangi UK

Swiss Steel Group (SSG) has come up with a white paper for its Green Steel initiative for ecologically produced low-emission steel.

Green Steel is thus not only a tool that helps reduce emissions, it is also intended to help customers and partners and encourage them to do more to mitigate climate change,” the group states.

The tasks of SSG’s production sites and scientific labs are thus massively expanded with Green Steel, Kallanish understands. Green Steel makes them platforms of technology, experimentation, and innovation whose horizon and impact extends far beyond the steel industry, the steelmaker declares.

Steel as a material contains a very high percentage of what is known as “embodied energy” that is part of almost every product and many services, the company writes. “Embodied energy is the ‘gorilla in the room’, the monster that no one wants to see.”

Its white paper is divided into Scope 1: Hydrogen instead of natural gas; Scope 2: Green power instead of embodied energy; Scope 3: High-alloyed scrap instead of alloying metals. It further deals with worthless waste heat as a resource and costly traction energy, Green Steel as a research and technology platform, and as a signal for other industries.

Christian Koehl Germany

With the acquisition of Metaltec AG in Pieterlen, Switzerland, voestalpine is further expanding the high-quality segment range of its subsidiary High Performance Metals Division.

Metaltec supplies bright bar, drawn or ground stainless steel that has the closest tolerances and a particularly even and smooth surface and thus improved machinability. The focus is on industries with the highest demands, such as the Swiss watch industry, medical technology (implants, instruments), but also the automotive supply industry, Kallanish learns. In 2021, the company achieved revenue of CHF 10 million ($11m) with 37 employees.

For the Swiss unit of voestalpine High Performance Metals, this will result in a unique selling proposition on the market in future, the steelmaker says.

Christian Koehl Germany

Eurofer has reiterated again this week the need for the EU to take action to secure future access to critical raw materials such as nickel, ferrous scrap and rare earths.

The European steelmakers association issued a joint call with WindEurope, the voice of the wind energy industry in Europe.

“In March the European Union will present its EU Critical Raw Materials Act (CRMA). This is of crucial importance for Europe’s energy security and for the success of Europe’s digital and green transitions. The CRMA must break Europe’s dependency on a handful of exporting countries. Only a level playing field in accessing critical raw materials will ensure the long-term competitiveness of European manufacturing and avoid carbon leakage,” reads the note published by Eurofer and WindEurope.

Specific attention was dedicated in the note to the problems faced over nickel supply – due to export restrictions from Indonesia – as well as rare earths and core materials for glass fibre imported from China. The latter is necessary for the development of the wind energy sector in Europe.

Ferrous scrap is also considered a critical raw material for steelmakers and Eurofer has been lobbying the EU for a long time to implement a system to control exports.

“Despite its critical importance for a successful decarbonisation of the steel sector and its value chain, scrap is the most exported waste stream from the EU to third countries (59% in 2021, according to Eurostat). Furthermore, most destination countries do not have environmental and social standards equivalent to the European ones. This paradoxical situation risks jeopardising both Europe’s strategic autonomy and its climate goals,” the statement seen by Kallanish explains.

“The EU steel industry needs access to both fossil-free energy such as wind, and key raw materials such as scrap, nickel and manganese to supply green steel to its value chain. In addition, we invite the Commission to formulate a proposal focusing on ‘strategic green transition goods’ like steel and wind in the context of the new Green Deal Industrial Plan, as these are an essential part of the clean tech value chain,” says Eurofer director general Axel Eggert.

Earlier this week, Cinzia Vezzosi, vice-president of Euric, a confederation representing European recycling industries, noted nevertheless that it is important to avoid demonising European scrap exporters.

“There are over 20 million tonnes of scrap that are not used by the European steel sector at the moment. The recycling sector will have no problems to supply these to the European steelmakers when needed. It is important nevertheless to secure the future economical viability of the recyclers, facing already higher costs due to investments to increase further the quality of the recycled materials,” Vezzosi said during a presentation.

Emanuele Norsa Italy

During negotiations for coil supply contracts for 2023, mills largely tried to keep the contract periods to half a year, rather than a full year, Kallanish hears from market players.

This in itself is not surprising; depending on the temporary price trends, either side may prefer to keep contracts shorter than a full year. As spot prices are currently gaining, it would be the mills that are favouring new negotiations in 5-6 months’ time.

According to the manager of a service centre, mills based their offers on six months, and asked for a premium for 12-month periods. Their offer prices were mostly down €200/tonne year-on-year, which often meant a hot rolled coil price of around €800/t ($871), depending on the individual deal. For the full year, mills asked for €50-60/t more, the manager tells Kallanish.

The automotive industry, especially, prefers full year-contracts. “When you accompany a car series, you need to plan long-term,” a buyer from a tier-1 supplier says. He signed deals relatively early in mid-December with a y-o-y discount of €200 or slightly less but does not detail if the premium was factored in.

Negotiations delayed until now should end in higher prices, but some buyers apparently still prefer to wait, possibly into February. The service centre manager confirms the earlier announcement of the market leader of HRC spot deals at €760/t, and that it will be charged on its online platform. But he believes the current surge will be followed by another downturn, as inventories at ports and companies are still relatively full.

“Some negotiators could be waiting for the current surge to come back down in February already, but I find that risky,” he says. A long standby period also creates a mental burden until you are free for your daily business as usual, he adds.

Christian Koehl Germany

This Thursday EUROMETAL visited 2 steel warehouses, in Ruddervoorde and Tielt in West Flanders.

The managing director of EUROMETAL, Ricardo Silva, was received by the president of Belmetal, the Belgian federation of steel distributors, Mr Johan Rosseel.

During the visit to the NV Rosseel warehouse and its subsidiary Metaalhandel Hemeryck-Heindryckx, both addressed topics of interest to independent distributors, namely in terms of health and safety of workers as well as the future of the stockholding business in an increasingly digital and less relational way.

Les conseils d’administration peuvent s’attendre à ce que leur processus de surveillance et de gouvernance soit davantage mis à l’épreuve au cours de l’année à venir par toute une série de défis: volatilité économique mondiale, guerre en Ukraine, perturbations de la chaîne d’approvisionnement, en passant par les risques sociaux et les risques de cybersécurité, mais également un marché des talents tendu.

SEPEM is a French industrial fair. Organized in different regions of France, this fair brings together all industrialists from an entire region.

In this edition in Douai, a town in the north of France, between Lille and Cambrai, it was possible to find not only some French steel distributors but also from the northwest of Belgium.

This visit allowed visiting the ArcelorMittal Distribution Solutions stand with emphasis on the e-steel platform, SAEY, Dubocage, France Steel, Contisteel, Irestal, Swiss Steel France and Thyssenkrupp Materials France.

Slovakia-based integrated steelmaker US Steel Kosice (USSK) has restarted a second blast furnace (BF) at its Kosice facility, the company told Fastmarkets on Wednesday January 25.

A spokesperson for the company confirmed earlier this week the restart of BF2, which has a capacity of 1.8 million tonnes per year of pig iron, after almost five months of downtime.

BF2 was stopped in September 2022 due to poor market fundamentals, Fastmarkets reported.

USSK also confirmed the restart of BF1 last week.

US Steel Kosice usually has three BFs operating at any given time, with a combined capacity of 5 million tpy of pig iron. The company produces at steel products: hot-rolled, cold-rolled and hot-dipped galvanized coil.

Currently all three BFs are operational, the spokesperson told Fastmarkets.

“I can confirm that all three blast furnaces have been in operation since the start of this week [January 23],” the spokesperson said.

The news about one more BF being brought back online raised concerns among the EU at steel market participants. They were worried that the gradual restart of idled steelmaking capacities that were suspended in the fourth quarter of 2022 would threaten the recent uptrend in prices in the EU
at steel market.

Earlier in January, ArcelorMittal said it was considering restarting a BF at its facility in Gijon, in northwest Spain.

Market sources said that the sharp price rises in the at steel segment were prompted by a more balanced market, and therefore increasing steel output might hamper further increases.

Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €754.55 ($820.57) per tonne on Tuesday, up by €2.05 per tonne from €752.50 per tonne on Monday.

The latest calculation of the index was up by €39.13 per tonne week on week and by €85.80 per tonne month on month.

By Julia Bolotova