Fastmarkets’ methodology defines European green flat steel as “steel produced with Scope 1, 2 or 3 emissions at a maximum of 0.8 tonnes of CO2 per tonne of steel.”
During the assessment week, a deal for 100 tonnes of green hot-rolled coil (HRC) was heard done with a premium of €180 ($210) per tonne in Germany.
Buyer sources estimated achievable premiums at €70-150 per tonne for green flats, while sellers claimed achievable prices were higher – at €150-180 per tonne, depending on tonnage.
Producers continued to offer such material at €200-210 per tonne and even as high as €300 per tonne from one Nordics-based supplier, but such premiums were rarely achieved in trades.
The wide price spread again highlighted that, although green steel has been discussed for some time, the market is still in its early stages, with demand remaining very niche.
“Green steel [demand] is still very much project-based; nobody buys it [green steel] for stock,” a seller in Europe said.
“The number of projects in Europe that genuinely require green steel – at least for now – is very small, and the pool of buyers remains limited,” a source at a German steel service center told Fastmarkets.
Fastmarkets’ weekly assessment of the green steel domestic, flat-rolled, differential to HRC index, exw Northern Europe, meanwhile, was set at €100-180 per tonne on Thursday, widening up from €100-170 per tonne seven days ago.
Fastmarkets’ assessment of the flat steel reduced carbon emissions differential, exw Northern Europe was €40-50 per tonne on Thursday, stable week on week.
For steel produced in blast furnaces with reduced carbon emissions of 1.4-1.8 tonnes of CO2 per tonne of steel, offers for premiums were reported at €60-70 per tonne during the assessment week.
Buyers’ estimates of tradable prices were around €30-50 per tonne, with no new trades reported.
Green longs
In the long steel segment, it remains much harder for producers to push through premiums among customers, owing to the initially more environmentally friendly nature of production.
Fastmarkets’ methodology defines European green long steel as steel produced with Scope 1, 2 or 3 emissions at a maximum of 0.5 tonnes of CO2 per tonne of steel.
Premium offers varied within the wide range of €20-50 per tonne, depending on producer, but getting this level appears nearly impossible.
“In fact, when a customer chooses a rebar supplier, those who have emissions higher than 0.45 tonnes of CO2 [per tonne] of steel provide discounts and those who have the required level of emissions or below that number sell at the standard price,” a producer source said.
Fastmarkets green steel, differential to steel reinforcing bar (rebar) domestic, delivered Northern Europe narrowed to €20-30 per tonne on December 3 versus €15-50 per tonne a week prior on November 26.
The assessment reflects the lowest offers targeted by suppliers.
