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Released January 02, 2025 | GALWAY, IRELAND
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Written by Martin Lynch, European News
Editor for Industrial Info (Galway, Ireland)--Europe's weakened steel sector has called on the European Union (EU) for urgent action to help protect it from cheap exports and rising electricity costs.
The European Steel Association, Eurofer, has issued a call for an "EU Steel Action Plan Now!" to the newly elected European Commission (EC), demanding measures that will restore the competitiveness of European steel, save the green transition underway and protect thousands of jobs currently at risk. Eurofer highlighted that global overcapacity is at a record high and energy and raw material prices at uncompetitive levels, which has placed the European steel sector "in crisis," endangering 300,000 direct jobs and 2.3 million indirect jobs. The call coincides with news that steel giant ArcelorMittal (NYSE:MT) (Luxemburg) is delaying billions of euros in planned investment in green steel projects due to unfavorable conditions. Industrial Info reported that the company has already received billions of euros from the EC and a number of governments towards these projects. For additional information, see August 1, 2023, article - Two European Green Steel Projects Get $3 Billion Boost.
ArcelorMittal stated recently: "The Company has previously announced the intention to invest in lower carbon emissions "hydrogen ready" DRI-EAF facilities to replace several blast furnaces across our European business, as a key strategic first step towards reducing emissions. Before taking final investment decisions it is necessary to have full visibility on the policy environment that will ensure higher cost steelmaking can be competitive in Europe without a global carbon price."
It added: "These projects were premised on a favourable combination of policy, technology and market developments that would facilitate decarbonization investment by helping offset the significantly higher capital and operating costs that this transition strategy would involve. This included being able to use natural gas until green hydrogen became competitive. However European policy, energy and market environments have not moved in a favorable direction. Green hydrogen is evolving very slowly towards being a viable fuel source and natural gas based DRI production in Europe is not yet competitive as an interim solution. Furthermore, there are significant weaknesses in the carbon border adjustment mechanism (CBAM), trade protection measures need strengthening in response to increasing imports due to China overcapacity, and there is limited willingness among customers to pay premiums for low-carbon emissions steel."
"Steel is the backbone of manufacturing and vital for cleantech value chains, from renewables to electric vehicles," said Axel Eggert, director general of Eurofer. "What is at stake is more than just the steel industry, it's Europe's prosperity and resilience. Billions of our investments in decarbonisation are at risk, while we have to bear energy costs that are 2-3 times higher than those of our main competitors in the U.S. and China. Now more than ever, we need an EU Steel Action Plan, including robust measures from trade to energy and green lead markets to ensure European steel's viability. Following the elections in the U.S., the European social partners call on the EU and the U.S. to continue working together to jointly tackle global challenges such as third country driven, massive steel overcapacity and unfair trade practices that harm both sides."
In response, the newly elected Stephane Sejourne, executive vice president-designate for industry at the Commission, claimed he will look into ways to extend measures to limit steel imports in order to protect the decarbonization of the sector. On a visit to Ghent steelworks, owned by ArcelorMittal, Sejourne said the Commission may extend existing safeguards and introduce other measures to protect against cheaper Chinese imports and higher power costs. "The United States promises to put up trade barriers against us. Europe cannot be the only continent where overcapacity is poured out in competition against our industries. We are looking into similar clauses that would have exactly the same impact, that are World Trade Organization (WTO) compatible." Sejourne said.
EUROFER's calls are backed by the IndustriAll European Trade Union, a federation of unions representing more than 7 million workers across 39 countries in the metal, chemical, energy and mining sectors, among others. Judith Kirton-Darling, IndustriAll Europe's general secretary, said: "The European steel sector is in crisis and every day we are dealing with production cuts, mothballing, closures and bankruptcies of steel sites across Europe. Steel jobs are highly skilled and decent jobs, and we must protect them. We completely oppose European steel sites closing only for cheap and dirty steel to be dumped on the open EU market with no respect to the environment or social standards. Decarbonisation must not lead to de-industrialization and we need the EU to ensure a level playing field and a sustainable future for European steel workers. Steel needs Europe and Europe needs steel."
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
The European Steel Association, Eurofer, has issued a call for an "EU Steel Action Plan Now!" to the newly elected European Commission (EC), demanding measures that will restore the competitiveness of European steel, save the green transition underway and protect thousands of jobs currently at risk. Eurofer highlighted that global overcapacity is at a record high and energy and raw material prices at uncompetitive levels, which has placed the European steel sector "in crisis," endangering 300,000 direct jobs and 2.3 million indirect jobs. The call coincides with news that steel giant ArcelorMittal (NYSE:MT) (Luxemburg) is delaying billions of euros in planned investment in green steel projects due to unfavorable conditions. Industrial Info reported that the company has already received billions of euros from the EC and a number of governments towards these projects. For additional information, see August 1, 2023, article - Two European Green Steel Projects Get $3 Billion Boost.
ArcelorMittal stated recently: "The Company has previously announced the intention to invest in lower carbon emissions "hydrogen ready" DRI-EAF facilities to replace several blast furnaces across our European business, as a key strategic first step towards reducing emissions. Before taking final investment decisions it is necessary to have full visibility on the policy environment that will ensure higher cost steelmaking can be competitive in Europe without a global carbon price."
It added: "These projects were premised on a favourable combination of policy, technology and market developments that would facilitate decarbonization investment by helping offset the significantly higher capital and operating costs that this transition strategy would involve. This included being able to use natural gas until green hydrogen became competitive. However European policy, energy and market environments have not moved in a favorable direction. Green hydrogen is evolving very slowly towards being a viable fuel source and natural gas based DRI production in Europe is not yet competitive as an interim solution. Furthermore, there are significant weaknesses in the carbon border adjustment mechanism (CBAM), trade protection measures need strengthening in response to increasing imports due to China overcapacity, and there is limited willingness among customers to pay premiums for low-carbon emissions steel."
"Steel is the backbone of manufacturing and vital for cleantech value chains, from renewables to electric vehicles," said Axel Eggert, director general of Eurofer. "What is at stake is more than just the steel industry, it's Europe's prosperity and resilience. Billions of our investments in decarbonisation are at risk, while we have to bear energy costs that are 2-3 times higher than those of our main competitors in the U.S. and China. Now more than ever, we need an EU Steel Action Plan, including robust measures from trade to energy and green lead markets to ensure European steel's viability. Following the elections in the U.S., the European social partners call on the EU and the U.S. to continue working together to jointly tackle global challenges such as third country driven, massive steel overcapacity and unfair trade practices that harm both sides."
In response, the newly elected Stephane Sejourne, executive vice president-designate for industry at the Commission, claimed he will look into ways to extend measures to limit steel imports in order to protect the decarbonization of the sector. On a visit to Ghent steelworks, owned by ArcelorMittal, Sejourne said the Commission may extend existing safeguards and introduce other measures to protect against cheaper Chinese imports and higher power costs. "The United States promises to put up trade barriers against us. Europe cannot be the only continent where overcapacity is poured out in competition against our industries. We are looking into similar clauses that would have exactly the same impact, that are World Trade Organization (WTO) compatible." Sejourne said.
EUROFER's calls are backed by the IndustriAll European Trade Union, a federation of unions representing more than 7 million workers across 39 countries in the metal, chemical, energy and mining sectors, among others. Judith Kirton-Darling, IndustriAll Europe's general secretary, said: "The European steel sector is in crisis and every day we are dealing with production cuts, mothballing, closures and bankruptcies of steel sites across Europe. Steel jobs are highly skilled and decent jobs, and we must protect them. We completely oppose European steel sites closing only for cheap and dirty steel to be dumped on the open EU market with no respect to the environment or social standards. Decarbonisation must not lead to de-industrialization and we need the EU to ensure a level playing field and a sustainable future for European steel workers. Steel needs Europe and Europe needs steel."
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
