ArcelorMittal Poland (AMP) says it recognises the need to decarbonise but, amid the high costs of transitioning to new technologies and pressure from low-priced steel imports, European steelmakers cannot bear the costs of this process alone.
The steelmaker was reported earlier this week to be in talks with the Polish government over PLN 1 billion ($268.5 million) in state aid for the modernisation of a blast furnace at the Dabrowa Gornicza steelworks.
The firm did not comment on the sum of state aid being discussed or what work exactly will be done on its production units. However, it said previously it plans to transition the plant away from the blast furnace production route to EAF steelmaking in stages, with long products the first to be produced via EAF.
Decarbonisation “means building new installations and implementing new steelmaking technologies … in a challenging market: the European steel sector already has to bear costs that our competitors in third countries do not,” AMP tells Kallanish. “For example, Europe has the world’s highest energy costs, and the EU ETS – Emissions Trading System – operates only in Europe.”
“This market environment translates into a rapid increase of low-priced steel imports into Europe. Imports from outside the EU, where production costs are significantly lower, already satisfy almost 30% of apparent steel consumption in Europe,” it continues. “Against this backdrop, no steel producer can bear the costs of the transition to low carbon-emissions steelmaking alone.”
The firm is also calling for the reduction of energy costs and effective mechanisms to prevent carbon leakage. It has urged the European Commission to implement quickly the measures outlined in the Steel and Metals Action Plan.
Were AMP to receive state aid for decarbonising its production process, it would be the first steelmaker in Poland to do so. The country’s other producers are all electric arc furnace-based. One of them, Huta Czestochowa, is in the process of being acquired by Poland’s defence ministry. The country is working on a steel industry strategy.
AMP produced 3.8 million tonnes of crude steel in 2024, up from 3.1mt in 2023, but down from 4.8mt in 2019, pre-Covid.
Adam Smith Poland
