EUROMETAL COPENHAGEN: New EU plate capacity may lead to price pressure

New steel plate capacity in France and Italy will increase competition and put pressure on European quarto plate prices, Eugene Sarkits, sales director at Novolipetsk Steel Europe (NLMK), said on Thursday June 8.

Laminoirs des Landes, a 500,000 tpy heavy plate joint venture between Italian steelmaker Beltrame and Spain’s Hierros Anon, will be operational in September 2017. The new mill is in Bayonne, southern France.

Meanwhile, Italy’s troubled steelmaker Ilva is set to return to the plate market in 2017 “with a nominal capacity of 1.40 million tpy,” according to European steel trade federation Eurometal.

“Apparent EU plate consumption is around 10 million tpy, and EU plate capacity is around 16 million tpy so there is a need to cut capacity,” Sarkits told delegates at Eurometal’s regional meeting in Copenhagen, Denmark, on Thursday.

“So, this will be a headache for Dillinger in France, ArcelorMittal in Spain, and NLMK,” Sarkits said.

NLMK operates the 550,000-tpy Dansteel plate mill in Denmark and has further strip and plate facilities in Italy and Belgium.

European domestic heavy plate production was 10.20 million tpy in 2016, having decreased steadily from 12.60 million tpy in 2011, according to Eurometal.

Imports had a 27.80% share of the EU heavy plate market in 2016, up from 26.20% in 2015 and 20.40% in 2014, Eurometal said.

The increasing market share of imports in the EU plate market led to the European Commission starting an anti-dumping (AD) investigation into imports of heavy plate from China in February 2016.

The EC imposed definitive anti-dumping duties at rates of 65.10-73.70% on heavy steel plate imported from China on February 28, 2017.

Imports of heavy plate into the Europe have fallen by 14% year-on-year to 842,000 tpy in January-April 2017, down from 980,000 tpy in the corresponding period of 2016, according to Eurometal.

Following the imposition of duties, plate imports from China into the EU over the same comparison tumbled to just 2,000 tpy, down from 456,000 tpy in January-April 2016.

“Imports from Ukraine have almost completely replaced the volumes from China – their local market is small so they have to export,” Sarkits said.

Other imports are coming from India, Severstal in Russia, and South Korean steelmaker Posco’s domestic mills and its Indonesian operations, Sarkits added.

Viral Shah