Covid-19 crisis shows greater flexibility requirement: EU players

Steel mills are facing challenges to act more flexibly in extraordinary periods like the current Covid-19 crisis, says Eurofer director of trade and external relations Karl Techelet.

“The matching of steel production to volatile demand is a key issue, especially given the high volatility we see in the market now,” he said at the Kallanish Europe Steel Markets 2020 virtual conference on Thursday. “You cannot adjust all that quickly to a quickly changing demand situation.” He noted that such preparedness takes extra effort in order to manage capacities, especially with blast furnaces which are less flexible.

EUROMETAL Director General Daniel Guinabert extended that recommendation to the distribution sector, which he said ought to think about new models in their business, meaning tools like automation and digitalisation. “The profitability of stockholders is only a few euros per tonne, that’s why we must adapt our capacities to the end users’ demand,” he said, noting that means prioritising variable costs over fixed costs.

Techelet also emphasised the line between safeguard measures and anti-dumping measures. The latter are not an alternative, mainly because they tackle different issues: “Antidumping addresses unfair trade practices and subsidisation, rather than the volume effect, which is the function of safeguards.”

Also, antidumping measures are too slow, as any trade case can take more than one year. They are also too narrow, as they only address a specific country and a specific product, Techelet explained.