The Italian flat steel market faced continuing uncertainty after a key legal body put off a decision May 13 on the future of the largest domestic producer, the former ArcelorMittal Italia, now Acciaierie Italiane.
The market had awaited the Italian State Council’s decision on whether Acciairie Italiane could keep producing crude steel after the Lecce regional administrative court said Feb. 13 that ArcelorMittal had to shut all hot-end operations within 60 days at its Taranto plant to curb emissions.
ArcelorMittal appealed the decision to the Italian State Council, with a final hearing expected May 13, but the court said it would take more time to decide. A decision should come within 45 days, but sources said it is likely to be made sooner.
“Italy is a major transformer market that consumes around 12 million-13 million mt of coils a year, so we need a strong domestic player,” a source from a large Italian distributor said. “It is impossible to find materials at the moment, and whoever has materials can do the prices that they want. It is so crazy what is happening to Acciairie Italiane, as we need material.”
Amid the uncertainty, import quotas from crucial markets such as India have been exhausted. Steel demand is strong and supply is low.
Italian HRC prices have gone up this year Eur423/mt, with prices reported around Eur1,100/mt base ex-works with imports from Vietnam heard at $1,320/mt CFR Italian ports.
Acciairie Italia is working with two blast furnaces, No. 1 and No. 2, because No. 4 has been temporarily shut for maintenance and should restart by mid-June. The company is targeting 5 million mt of crude production by year’s end.
Each blast furnace has a design capacity of 1.8 million-1.9 million mt/year of crude steel, but they are not operating at capacity. Blast furnace No. 5, the largest in Europe with a production capacity of around 3.5 million mt/year, was idled in 2015. Blast furnace No. 3 has a capacity of about 2 million mt/year of crude steel but was idled in 1994 and is to be dismantled.
Italy has two large flat steel producers: Acciaierie d’Italia, with an installed capacity of 9 million-10 million mt of crude steel capacity a year, and Arvedi, with about 5 million mt of crude steel capacity.
Italy is the second-largest European steel producer after Germany. Last year, according to Italian steel association Federacciai, the country produced about 20 million mt of crude steel.
— Annalisa Villa
