Demand for green flat steel muted in Europe, but premiums remain high
Fastmarkets’ methodology defines European green steel as “steel produced with Scope 1, 2 & 3 emissions at a maximum of 0.8 tonne of CO2 per tonne of steel”.
During the assessment week, premiums for such steel were reported at €200-300 ($216.96-325.43) per tonne from major European suppliers.
Buyer sources estimated that achievable premiums for such material were at €100-150 per tonne. But suppliers claimed that the lower end of the range was not workable for electric-arc furnace (EAF)-produced green steel.
Notably, two suppliers told Fastmarkets that they would be willing to knock off no more than €20-30 per tonne from their offers of €200 per tonne.
Buyer sources argued that big tonnages (more than 3,000 tonnes) could be booked with lower premiums – of around €150 per tonne
“The demand [for green steel] is not booming, but we sell 200 tonnes here, 100 tonnes there,” a mill source said.
“Nobody books green steel to stockpile it – it would have been too expensive. So this is back-to-back business – you have a project, you book green steel for it,” the mill source added.
Transactions for flat steel produced with emissions below of 0.7 tonne of CO2 per tonne of steel were reported at €170-180 per tonne, for May-shipment material.
While Nordic countries remained the main demand drivers in Europe, sources have also pointed out that they noted they have heard more inquiries coming from Spain lately.
As a result, Fastmarkets’ assessment for green steel domestic, flat-rolled, differential to HRC index, exw Northern Europe was €150-200 per tonne on Thursday, widening upward from €150-180 per tonne in the previous week.
Meanwhile, Fastmarkets’ assessment of the flat steel reduced carbon emissions differential, exw Northern Europe was €30-60 per tonne on Thursday, unchanged week on week.
For steel produced in blast furnaces, with reduced carbon emissions of 1.4-1.8 tonnes of CO2 per 1 tonne of steel, offers for premiums were reported at €40-70 per tonne during the assessment week.
Notably, premium steel produced with carbon footprint of 1.5 tonnes of CO2 per 1 tonne of steel was reported at €70 per tonne from one supplier.
For steel with produced with 1.8 tonnes of CO2 carbon footprint, the premium was reported at €40 per tonne.
Buyer sources estimated a premium level of €30-60 per tonne, depending on the carbon footprint.
Salzgitter Mannesmann Handel introduces tool for carbon footprint
Salzgitter Mannesmann Handel GmbH, the distribution subsidiary of Salzgitter AG, is introducing a new calculation tool for the product carbon footprint (PCF).
The group describes the tool as a calculation methodology in accordance with the Greenhouse Gas Protocol and ISO 14067, determining the CO2 footprint along the entire value chain. It enables Salzgitter Mannesmann and its units to provide complete transparency concerning the carbon footprint of the steel products they are offering. Following successful validation by TÜV SÜD, the calculation tool will be made available to the market with immediate effect, Kallanish hears.
“The new PCF software solution calculates the PCF of the steel product, from raw material extraction through to the customer’s factory gate – cradle-to-customer entry gate,” says Tanja Jacobs, business development head at Salzgitter Mannesmann Handel. “The entire range of greenhouse gases are included and converted into CO2 equivalents,” adds Salzgitter Mannesmann Handel managing director Alexander Soboll.
Christian Koehl Germany
