Green flats
Fastmarkets’ weekly assessment of the green steel, domestic, flat-rolled, differential to HRC index, exw Northern Europe was €150-200 ($220-330) per tonne on April 10, flat week on week.
Fastmarkets’ methodology defines European green flat steel as “steel produced with Scope 1, 2 & 3 emissions at a maximum of 0.8 tonnes of CO2 per tonne of steel.”
For steel that falls under such specifications, offers from major European suppliers were stable at premiums of €200-300 per tonne. Offers at the higher end of the range were mainly reported from Nordic-based suppliers.
These offers have been broadly stable in the past months, but tradable premiums for the spot market were lower, sources said.
During the assessment week, minor tonnages were traded at a premium of €200 per tonne in Northern Europe.
The latest transactions for green flat steel were reported in March at premiums of €170-180 per tonne for volumes over 1,000 tonnes, sources said.
Buyer sources told Fastmarkets they estimated that achievable premiums for green steel with that level of emissions would be closer to €100-200 per tonne.
Some bids were even reported at premiums of €70-80 per tonne during the week, but suppliers said that such premiums would be acceptable for steel produced with higher CO2 emissions content.
“[A premium of] €70 per tonne is for steel with an emissions threshold of around 1.5 tonnes of CO2 — some suppliers in Europe offer steel with such emissions exactly at such levels,” a mill source said. “But, for steel [made in electric-arc furnaces (EAFs)] with emissions below 1 tonne of CO2 per 1 tonne of steel, this price is too low.”
A mill source estimated achievable premiums at €150-200 per tonne.
Another mill source estimated achievable premiums at €170-200 per tonne.
Overall, activity in the spot market remains sporadic, while increasingly more buyers are looking to sign long-term agreements with green steel suppliers, expecting higher demand in the years to come.
Notably, Nordic green steel startup Blastr signed a memorandum of understanding with Netherlands-based steel service center Vogten Staal for low-carbon emissions steel supply on Monday April 7.
This is the third offtake agreement announced by Blastr in the past few months, supporting a material increase in the supply of decarbonized steel products in Europe.
But when contacted by Fastmarkets, the company did not specify either the start of the deliveries or the volumes.
Established in 2021 with the aim of becoming an integrated low-CO2 steel producer, Blastr planned to produce around 2.5 million tonnes per year (tpy) of hot- and cold-rolled steel.
Final investment decisions on both a direct-reduced iron (DRI) plant and a steel plant were expected by early 2026.
Vogen Staal has processing lines in Maastricht, the Netherlands. The company has recently invested in a second production facility. When all new lines are installed, the production capacity of both facilities will be well over 1 million tpy.
Green longs
On Wednesday April 9, Fastmarkets launched two new European green long steel prices to reflect emerging market interest in low-carbon material.
Fastmarkets’ inaugural weekly price assessment for green steel, differential to steel reinforcing bar (rebar), domestic, delivered Northern Europe was €20-30 per tonne on April 9.
And the first assessment of the green steel base price, reinforcing bar (rebar), domestic, delivered Northern Europe, inferred was €660-710 per tonne on Wednesday.
The latter price is calculated by adding the weekly green long steel differential to the weekly price for steel rebar, domestic, delivered Northern Europe.
The European long steel industry is predominantly EAF-based, which makes it a priori cleaner in terms of emissions compared with the blast furnace-basic oxygen furnace (BF-BOF) route that prevails in flat steel production.
EAF production typically emits around 0.8 tonnes of carbon emissions per 1 tonne of steel. Therefore, “green” requirements for long steel producers are stricter than in the flat steel sector.
Several sources stressed that, to be green, emissions produced by EAF-based mills within all three scopes should not be above 0.5 tonnes per 1 tonne of steel. As a result, Fastmarkets’ methodology defines European green long steel as “steel produced with Scope 1, 2 & 3 emissions at a maximum of 0.5 tonne of CO2 per tonne of steel.”
In such conditions, long steel producers in Europe are squeezed between stricter criteria for being considered green and limited demand.
“Being an EAF producer is both an advantage and a disadvantage,” a producer from Southern Europe told Fastmarkets. “On one hand, we are already green, but on the other, customers do not see why they have to pay a premium for what they had previously been buying without it.”
Even in Northern Europe, which is pioneering the utilization of green long steel, the demand is said to be limited.
“At this moment, I see no willingness to pay extra for low-carbon steel in the rebar sector — only for specific projects where there is an order qualifier and the options are limited,” a trader from Northern Europe said.
In such conditions, customers are not ready to accept mills’ offers, which vary in the range of €30-50 per tonne, depending on the supplier.
A source on the sellers’ side said that customers accept premiums at the lower end of the range, but sometimes, producers accept lower numbers.
“Charging premiums for longs is very difficult in Europe, as the production nature is already greener than for flats,” a trading source said, providing an assessment of a workable premium at a maximum of €20 per tonne.
