Demand for low-CO2 steel products remains weak across Europe, with limited willingness from customers to pay a premium for “green” steel. Developing a market for green steel is however essential to unlocking decarbonisation investments, says ArcelorMittal Belgium chief executive Frederik Van De Velde.
Speaking at a hearing earlier this week in the Belgian federal parliament, monitored by Kallanish, Van De Velde emphasised that new regulatory frameworks are required to stimulate demand for low-emission steel products. These include the effective implementation of CBAM and trade measures, competitive energy pricing, and stronger government support for industrial investments.
“In order to create a market for green steel as a steelmaker you need clients ready to buy your products at a fair price. Today, we realise there is a weak demand for low-carbon products,” Van De Velde stated.
Once the decarbonisation roadmap is fully implemented, steel production costs, and consequently prices, will increase. “Clients tell us that what counts for them is the price,” he explained, adding that the number of buyers willing to pay a premium for ArcelorMittal’s low CO2 steel products remains “extremely limited”.
Current green steel volumes are insufficient to justify further large scale investments or to reach the 2 million tonnes/year of green steel capacity required to build the company’s first electric arc furnace in Belgium. He pointed out the urgent need to create a market for green steel, which would, in turn, trigger the investments necessary to decarbonise Europe’s steelmaking industry.
In Belgium, ArcelorMittal operates four steel hubs located in Ghent, Geel, Genk, and Liège, generating approximately €5 billion ($5.8bn) in revenue, employing around 5,000 people last year.
The company’s decarbonisation strategy in Belgium focuses on energy and production efficiency through the so-called “Green Primary” project, which promotes circularity, increases scrap usage and electrification, as well as the deployment of biofuels, carbon capture and utilisation (CCU), and carbon capture and storage (CCS) technologies.
ArcelorMittal Belgium currently uses two blast furnaces. The company plans to construct two EAFs, progressively phasing out the existing blast furnaces and targeting a 50% reduction in CO2 emissions.
In Belgium, the company is implementing the CCU Steelenol project. The €215 million facility operating in Ghent may be shut down, the steelmaker warned in June, as it is unprofitable due to current EU regulations (see Kallanish 23 June).
Natalia Capra France
