Steel long producer Beltrame pondering production move to Italy

Europe’s largest merchant bar producer, Beltrame, is considering moving its steel sections rolling mill from its plant in Switzerland, Stahl Gerlafingen, to its mill in Vicenza, Northeast Italy, in order to avoid the 25% safeguard cap, sources close to the mill told S&P Global Platts Monday.

“We need to move the sections rolling mill as under the safeguard measures, as they are designed now, we can’t [sell] part of our sections production without buyers needing to pay the extra 25%. For example, we can’t still sell 18,000 mt [of] sections, while for rebar it’s not a problem as we sell the majority of our production into the domestic Swiss market,” a source explained, stressing that some of the blooms used to make the sections in Switzerland are from Italy. “…It is bizarre as most of the raw materials used for the sections arrive from Italy but nevertheless, the final product is considered non-EU,” he added.

Beltrame’s steel plant in Switzerland has an EAF (electric arc furnace) with a design capacity of 1 million mt of crude steel/year and two rolling mills. One rolling mill has a capacity of 800,000 mt and it transforms the crude steel into rebar, while the other processes sections. It has a capacity of 500,000 mt so it uses also blooms from Vicenza’s headquarters.

According to the EC website, only around 6,500 mt of the Swiss-origin quota remains for product category 17, which covers angles, shapes and sections of iron or non-alloy steel, for the 2019-2020 annual quota (code 098896).

On January 17, 2019, EU Member states approved the European Commission’s (EC’s) final safeguard measures on steel with implementation from February 2, 2019. For phase 2 from July 1, 2019, the quota levels increased by 5% across all product categories. The safeguards were strengthened on October 1, 2019, with individual countries limited to 30% of the residual quota, and the annual 5% relaxation in the quota size retroactively reduced to 3%.

EUROFER, the European steel Federation has been very vocal about all the safeguards process as they think that due to the overall decrease in the steel demand, the safeguard quotas and transfer mechanism of unused quarterly quota should change.

In Vicenza, where Beltrame has its headquarters, the company has an EAF with a design capacity of around 1.3 million mt of crude steel and two rolling mills for the production of merchant bar with a capacity of 800,000 mt. Part of Vicenza’s semis are transformed in Switzerland and Turin.

In Turin, Beltrame now has only two rolling mills with a combined capacity of 700,000 mt/year for the production of merchant bar. In the past it used to have a hot end, but it has been idled since May 2012.

The company also is very active in France, where it has a mill called Laminés Marchands Européens (LME), located in Trith Saint Léger, which has one EAF with a design capacity of 1 million mt of crude steel/year and two rolling mills with more then 700,000 mt of merchant bar capacity.

Currently, LME, like other France-based mills, is experiencing delivery problems due to the strikes that are happening across all of the country on the new pension reform. Local sources said the strikes are currently easing with the pension reform bill to be discussed in the French parliament on February 17.

Beltrame also has a rolling mill in Romania with a capacity of 250,000 mt of special bar quality steel, mainly for the automotive.

Beltrame declined to comment.

— Annalisa Villa, Viral Shah