Category: Latest Updates

The UK government has approved the Trade Remedies Authority’s recommendation that existing antidumping measures on cold-rolled flat steel from Russia and China be kept for another five years, the government said Aug. 30.

The TRA’s recommendation that the existing measures should be kept to protect the UK’s industry was initially made in March after a review that started in April 2021.

The recommendation was then opened for comments, and the TRA made a final recommendation, which has now been accepted by the Secretary of State for International Trade Anne-Marie Trevelyan.

“As part of its assessment, the TRA found that extending the antidumping measure for a further five years would be in the economic interest of the UK,” the government said, adding that the TRA had also found that cold-rolled flat steel from China and Russia would likely be dumped in the UK if the measure was removed, causing injury to UK producers.

The UK chose to maintain some of the EU’s trade remedy measures after Brexit and in December 2020 the then Secretary of State for International Trade Liz Truss chose these measures to be reviewed by an independent body to determine whether they should be varied or revoked in the UK.

According to the TRA, the UK’s cold-rolled flat steel market is 40%-50% supplied by domestic material, with imports supplying the remainder.

Cold-rolled flat steel is mostly sold through steel service centers and used in the auto industry and in domestic appliances, as well as other goods.

The TRA said that, while it had identified 50-100 downstream customers in the UK, which had a combined turnover of GBP 685 million ($801.15 million), the industry was vulnerable, due to raw material prices, the coronavirus pandemic, long-term economic trends, and energy costs.

Platts assessed the CRC ex-works Ruhr price at Eur825/mt Aug. 26, down 22.9% since the start of 2022, according to S&P Global Commodity Insights.

— Jacqueline Holman

Long steel producer Pittini Group’s Ferriere Nord has suspended work at the Osoppo plant in Italy until Oct. 2 due to high energy costs, a union source told S&P Global Commodity Insights Aug. 30.

The company had communicated to unions that it would suspend work for 751 workers at the plant from Aug. 29 to Oct. 2, a representative from the Italian Union of Metalworkers, or Uilm, said.

Energy prices have been strong in Italy and year-ahead Italian futures on the EEX exchange settled at Eur525/MWh Aug. 29, up 44% since the start of the month.

The company will suspend and/or reduce working hours and use the Cassa Integrazione Guadagni Ordinaria, or Ordinary Wage Guarantee Fund, the representative said, which is a wage guarantee tool that can be used in the case of temporary suspension or reduction of working activities.

“There will not be a total closure of plant, rather a partial,” they said, adding that there would be no dismissals within the end of the year.

Pittini did not respond to S&P Global’s request for confirmation.

The steelmaker’s Osoppo’s 2.2 million mt/year electric arc furnace was installed in September 2019 with a larger diameter to reduce energy consumption and improve efficiency of the smelting cycle, the company said previously.

Platts assessment of TSI Northwest Europe Rebar was down Eur30/mt week on week to Eur950/mt ex-works on Aug. 24.

Deals heard over the week to Aug. 24 from Italy to Germany were booked around Eur930-940/mt delivered Germany. Large European producers are targeting sharp increases in long steel prices amid a jump in energy and transport costs.

— Jacqueline Holman, Viral Shah

European hot-rolled coil (HRC) prices sank deeper in the week to Friday August 26 amid limited demand and persistent overstocking. Nevertheless, ArcelorMittal increased its offers to reflect surging costs, sources told Fastmarkets.Europe’s flagship producer, ArcelorMittal, increased its offer prices for all coil products on Friday, despite weak market fundamentals.

Its new offers of hot-rolled coil (HRC) were heard at €800 per tonne ex-works for October rolling material and €850 per tonne for November rolling, several sources told Fastmarkets. This was substantially above the most recent deals concluded in Northern Europe within the range of €700-750 per tonne exw during the previous week.

ArcelorMittal’s increase was mainly due to a substantial rise in production costs amid surging energy prices across Europe, several trading sources told Fastmarkets.

Market sources said they now expect other European steelmakers to make a similar move.

Fastmarkets calculated its daily steel HRC index, domestic, ex-works Northern Europe at €720.00 ($717.86) per tonne on Friday, unchanged from the previous day.

The latest calculation of the index was down by €30.00 per tonne week on week and down by €137.50 per tonne month on month.

Transactions for HRC in Northern Europe were reported at €700-730 per tonne exw, but for small tonnages.

Trading activity in the region has been sluggish amid persistent overstocking, poor end-user demand and an unclear post-summer price trend. Market sources were, therefore, quite skeptical about ArcelorMittal’s price rise, considering the poor market fundamentals.

Most buyers estimated the workable price for HRC in the region to be €700-750 per tonne exw.

Fastmarkets’ calculation of its corresponding daily steel HRC index, domestic, exw Italy was €705.00 per tonne on Friday, also unchanged from the previous day.

The latest calculation of the Italian index was down by €35 per tonne week on week and down by €75 per tonne month on month.

The calculation was based on buyers’ estimates of achievable prices at €700-710 per tonne exw.

As a result of summer maintenance closures, there was minimal trading activity, sources said.

Demand for HRC in the nation has also been sluggish due to overstocking and a wait-and-see attitude among buyers.

Imports

Demand for overseas coil remained slow during the assessment week.

Buyers in Northern Europe estimated the tradeable price for overseas coil at €650-670 per tonne cfr.

Long delivery times continued to be a factor driving the low number of transactions in the import market, Fastmarkets heard.

Some customers, anticipating depressed end-user consumption, were reluctant to submit orders for stock. There were concerns that they could take many months to arrive, by which time the material could be over-priced or demand for it might be very low.

Published by: Julia Bolotova

European hot-rolled coil prices moved up slightly, with increasingly more producers pushing for higher offers amid surging costs, Fastmarkets heard on Tuesday August 30.The downtrend that has persisted in the European flat steel market for the past several months seems to be coming to an end, despite still-low demand

Last Friday August 26, Europe’s leading producer ArcelorMittal increased its offer prices for all coil products by €50-100 per tonne depending on lead times.

During the week starting Monday August 29, more European mills have followed suit and announced offer price rises for flat steel products – including HRC – in the face of skyrocketing costs, Fastmarkets heard.

Notably, on August 30, Slovakia-based steel mill US Steel Kosice pushed for a €100-per-tonne price rise for October rolling HRC “as a result of skyrocketing energy prices and record-breaking levels of inflation,” the company said in a notice seen by Fastmarkets.

According to market sources, several other producers including Dunaferr and Liberty Steel have made similar moves and pushed for €70-100 per tonne higher flat steel offers.

After the price increases, HRC offers from the mentioned mills vary in a range of €850-870 per tonne delivered, Fastmarkets heard

One German producer also increased its offer price to €800 per tonne exw, sources said.

The targeted offers are still substantially above the tradeable level reported by market sources, however.

Fastmarkets calculated its daily steel HRC index, domestic, ex-works Northern Europe at €735 ($732.81) per tonne on Tuesday, up by €15 per tonne from the previous calculation of €720 per tonne exw on Friday. Fastmarkets’ HRC indices were not updated on Monday due to a UK public holiday.

The latest calculation of the index was up by €12.60 per tonne week on week but down by €121.25 per tonne month on month.

Several trading sources estimated the workable level for HRC in Northern Europe at €720-730 per tonne exw, but one transaction for a small volume of HRC was reported at €750-760 per tonne exw in the region this week.

In general, trading activity in the region has been sluggish amid persistent overstocking; however, several mills reported an increased number of inquiries from buyers.

“Everyone is checking to understand the price direction, but the activity is still weak,” a source in Germany said.

“It is too early to speak about the price rise. Without reasonable demand, it won’t be possible to achieve higher prices,” a mill source told Fastmarkets.

Fastmarkets’ calculation of its daily steel HRC index, domestic, exw Italy was €716.67 ($714.54) per tonne on Tuesday, up by €11.67 per tonne from the previous calculation on Friday.

The latest calculation of the Italian index was down by €0.83 per tonne week on week and down by €63.33 per tonne month on month.

The calculation was based on buyers’ estimates of achievable prices at €700-740 per tonne exw.

Most of the market participants in Italy were still out of the market due to the summer holiday period, so activity was minimal. Sources expect Italy’s HRC market to fully restart from holiday mode next week.

However, sources agreed that Italy’s mills will also attempt to push for higher prices to reflect surging energy costs.

In fact, one integrated steel mill in the nation has already pushed for a €100-per-tonne rise, with other two flat steel makers in the nation expected to make similar moves.

New HRC offers in the nation are expected to be about €800 per tonne exw, several sources told Fastmarkets.

Published by: Julia Bolotova

Eurofer issued last week its latest quarterly economic outlook, confirming that the European steel industry is going through a year of decline versus 2021.

For 2022, Eurofer now expects apparent steel demand to fall 1.7% year-on-year to 147 million tonnes. The previous forecast in May was for a 1.9% drop. In 2023 apparent steel demand should bounce back by over 5% y-o-y, Eurofer explains.

For real consumption of steel in Europe, the latest outlook indicates it should recover by 1.5% this year and 3.1% next year, Kallanish notes.

“A gloomier outlook for the steel market for the rest of 2022 is consolidating and will most likely have spill over effects also on 2023,” says Axel Eggert, director general of Eurofer. “We have been facing skyrocketing energy prices and bottlenecks in supply chains for almost a year now, and the dire consequences of Russia’s invasion of Ukraine for half a year. Yet, there is no sign that uncertainty will ease anytime soon, while steel imports in the EU are still significant: this is detrimental for a healthy EU steel industry.”

Imports of steel products remained strong during the first half of 2022. Finished products imports have so far increased by some 9% y-o-y. If the trend continues for the remainder of the year, overall 2022 imports of finished products could approach a record level of 35mt.

EU exports of finished products, on the other hand, are continuing the negative trend started in 2021. During the first six months of 2022, these decreased 14% y-o-y.

Overall, the EU’s trade deficit for all steel products amounted to 2.1m t/month during the first six months of this year. In full-year 2021, the trade deficit was 1.5m t/m.

Emanuele Norsa Italy

French stainless steel producer Aperam has decreased its alloy surcharges for September for its austenitic range of flat stainless steels for Europe, Kallanish notes.

Aperam’s surcharges next month for grade 304 (1.4301) will decrease moderately from €2,553/tonne ($2,551) this month to €2,521/t, effective 1 September. Grade 316, however, will fall significantly, from €3,917/t to €3,788/t. Grade 309S, a heat-resistant stainless steel used in high-temperature applications, will also see its value decrease from €3,567/t in August to €3,521/t in September. The surcharge for the most popular ferritic grade, 409, will go down from €973/t to €946/t next month, the company reveals.

Offers for nickel cash buyers reached $21,510/t on 26 August, Kallanish notes.

Natalia Capra France

Tata Steel Nederland has signed contracts with three companies for the further technical preparations of the hydrogen route in Ijmuiden in the Netherlands. The first development will cost more than €65 million ($65m) and will result in an engineering package that forms the basis for a final permitting and project planning, Kallanish understands.

The three companies – McDermott, Danieli and Hatch – have their own specific expertise that collectively is needed to help shape hydrogen-based steel manufacturing, Tata notes. McDermott will be responsible for the construction input and support of the technical project management. Danieli is in charge of the engineering design for the technology to deliver direct reduced iron (DRI), the first step in the iron-making process. Hatch is the technology licensor of the electric furnaces that melt the DRI and help to reduce the oxygen content further.

“We recently signed agreements about our future with two ministries and the province of North Holland,” says Hans van den Berg, ceo of Tata Steel Nederland. He adds that the company has committed to being CO2 neutral before 2045 and emit between 35-40% less CO2 before 2030.

The new plants will be built on-site while all the current plants remain in operation until the new installations are up and running, explains sustainability director Annemarie Manger.

“The coalition that is now formed with McDermott, Danieli and Hatch marks the start of the basic engineering to define our plans more specifically,” she says.

Christian Koehl Germany

Ferriere Nord, a subsidiary of long steel producer Pittini, has requested access to a temporary layoff scheme for over 750 workers at its plant in Osoppo near Udine, northern Italy, Kallanish learns from union sources.

The layoffs are starting this week and should last until 2 October. For the next two weeks, both the hot and cold areas at Osoppo will be idled. Informed sources say this will help address the issue of overcapacity for long products. The layoff request, however, is mainly driven by skyrocketing costs of energy in Italy and raw material procurement difficulties. Other producers of wire rod in Italy still remain idle due to longer maintenance stoppages this summer.

The electric arc furnace-based plant in Osoppo has a rebar and rebar in coil mill, a wire rod mill, and several mills for the production of mesh and lattice girders.

Ferriere Nord has another plant in Potenza, southern Italy, which make bars, mesh, rebar in coil and wire rod mainly for construction and mechanical applications.

Pittini employs around 1,800 workers and has a yearly production capacity of approximately 3 million tonnes across 18 production and logistic facilities.

In Italy, the group includes Ferriere Nord, Acciaierie di Verona, Siderpotenza, Pittarc, La Veneta Reti and Siat.

Pittini did not comment before deadline.

Natalia Capra France

European steelmakers are returning to the market after the summer break with higher coil offers for October and November deliveries.

Market sources confirm that ArcelorMittal has given notice since last week that its HRC offers are at €800-850/tonne ex-works base for European clients. The Kallanish price assessment for northern Europe HRC currently stands at €750-820/t ex-works base.

For hot-dip galvanized coil, ArcelorMittal’s new offers are pegged at €930-980/t ex-works base.

It is still unclear whether these new prices will be accepted by the market, but most sources confirm coil products have been at or near bottoming since July. In recent months, European suppliers of flat products have reduced their output in order to align supply with demand. These cuts should have an effect on prices from September onwards.

European steelmakers last increased offers in March, on various occasions, as a consequence of the uncertainty following the Russian invasion of Ukraine.

Emanuele Norsa Italy

Despite the current difficult conditions, machine tool orders in Germany continued to develop well in the second quarter, according to the German Machine Tool Builders’ Association (VDW). Order intake rose by 24% compared to the same period last year, Kallanish hears from the federation.

“Volumes are almost at record levels since 2018,” says Wilfried Schäfer, executive director of VDW. In the first half of 2022, orders increased by 34% overall. Domestic orders contributed to this with a 35% increase and foreign orders with a 33% jump.

Foreign business is primarily driven by demand outside the EU. In particular, the industry’s two lead markets, China and the USA, remained strong, Schäfer highlights. Surprisingly, “the severe lockdown in Shanghai and other Chinese cities did not leave any deeper traces in the second quarter.”

In terms of categories, cutting machining is currently pulling up the overall result. Demand in H1 was twice as strong as that for forming technology, for example. “This is an indication that major projects in the automotive industry are currently on hold, especially in Germany,” Schäfer explains. Forming technology accounts for around 30% of total machine tool sales. Press technology, in particular, is used in major projects.

Sales continue to be a cause for concern, the federation notes. In H1 they were up 7% year-on-year but, in real terms, this means stagnation. “Supply chain problems are far from over,” says Schäfer. Still, capacity utilisation rose slightly, from 85.9% in April to 87.4% in July.

Christian Koehl Germany