Mills with verified emissions data are expected to gain a competitive advantage as buyers prioritise suppliers with reliable carbon data by 2027, Kallanish learns from the producers committee at the recent Irepas meeting in Amsterdam.
However, only a limited number of suppliers, particularly in Japan and South Korea, are currently prepared.
Trade policy remains a central concern for producers, with the EU’s Carbon Border Adjustment Mechanism (CBAM) not expected to trigger immediate price changes, while producers anticipate medium-term disruption.
Overall, despite relatively stable demand and pricing conditions, the outlook remains uncertain, with energy costs, geopolitical developments and regulatory pressures posing ongoing risks to the global steel sector.
Meanwhile, the global steel industry is under pressure from rising costs, weak economic growth and regulatory complexity. Raw material prices have increased significantly, while limited ability to pass costs to customers continues to squeeze margins (see separate story).
Demand remains fragile, with subdued growth across regions limiting recovery, while energy markets are highly volatile due to tensions in the Middle East, with no clear timeline for resolution.
Logistical constraints are adding to cost pressures. Port congestion in the Middle East, limited truck availability and rising freight costs, driven by higher bunker fuel prices and fuel shortages, are increasing delivery costs.
Production disruptions in Iran have also impacted the global semis supply, with around 10 million tonnes of capacity reportedly damaged and recovery expected to take six to 12 months, contributing to higher Chinese semi-finished exports.
On the raw materials side, availability remains a structural constraint. European producers reliant on scrap have limited flexibility to switch to alternative inputs such as HBI due to high energy requirements, suggesting little change in production routes in the near term.
Author: Elina Virchenko
