Soaring energy idles ArcelorMittal Germany units, imports DRI

ArcelorMittal Germany is feeling the consequences of the exorbitant rise in energy prices, weak market demand and a negative economic outlook. The firm says the operation of all assets is no longer economically viable.

From the end of September, the group will shut down one of two blast furnaces at the Bremen flat steel site until further notice, Kallanish learns from a statement.

At the Hamburg long steel plant, which produces quality wire rod, the direct reduction plant will also be taken out of operation from the fourth quarter. The group already introduced short-time work at both plants, which will have to be extended as a result of the upcoming measures. Short-time work is also already being applied at the production sites in Duisburg and Eisenhüttenstadt due to the tense situation.

“The high costs for gas and electricity are putting a heavy strain on our competitiveness,” explains Reiner Blaschek, chief executive of ArcelorMittal Germany.

“With a tenfold increase in gas and electricity prices, which we had to accept within a few months, we are no longer competitive in a market that is 25% supplied by imports. On top of that, from October onwards, we will see the German government’s planned gas levy,” he adds.

In Hamburg, the company has already reduced the consumption of gas significantly. It has also purchased sponge iron externally from America, rather than using natural gas to produce its own. The plant has already reduced operations by about 80%. “The extreme price increase for gas and electricity forces the plant to import sponge iron completely with a higher carbon footprint in order to at least continue producing,” says Hamburg plant ceo Uwe Braun.

Christian Koehl Germany