Sep 28, 2022
EU re-rollers oppose ban on Russian semis
2022-10-03
A group of European re-rollers under the name of EU Reroller Forum has sent a letter to European authorities to express opposition to a potential ban on Russian-origin semi-finished steel imports into the EU.
While reaffirming their support in favour of the EU’s political and economic measures against Russia, the re-rollers believe that extending the sanctions to semis would only harm the European industry, rather than hit the Russian economy.
“The lack of supply for re-rollers would hamper the EU’s ability to build [among others] new wind installations and improve energy independence, while the semi-finished steel products [slabs, billets, and blooms] would be immediately redirected to other regions and with a 1% share of steel semis in total Russian exports, the potential ban would not have any tangible impact on Russia,” the letter seen by Kallanish explains.
European steelmakers have been lobbying the European Commission to extend the ban on Russian steel to semi-finished products. By doing so, they are “using political arguments in what is essentially an economic and competitive issue”, the letter explains.
“Re-rollers help balance the demand and supply of finished steel producers. The sector accounts for 8% of total EU flat steel output – almost 10 million tonnes – providing for more than 30,000 direct and indirect jobs in the EU,” the group explains.
European re-rollers have historically relied on Ukraine and Russia for 80% of their feedstock supply. Alternatives to these origins are scarce; supply from other third countries is often not competitive due to high prices and logistics costs. Iran could be a competitive partner, but supply from there has also been hit by sanctions.
“European integrated producers are currently temporarily idling blast furnace capacities and argue that they could replace imports – however, in the previous five years, less than 5% of semi-steel products purchases for re-rollers have come from EU producers. Under normal market conditions, there is no incentive for EU producers to supply semi-products to their EU re-rolling competitors. In some periods, big EU integrated producers use imported semis themselves to support their needs for additional steel making,” the letter signatories explain.
The EU Reroller Forum includes Marcegaglia, Pittini, Officine Tecnosider, Laminoirs Des Landes, Vitkovice Steel, Network Steel, Duferco, Dunaferr and NBH (the NLMK Belgian Holding).
Emanuele Norsa Italy
Source: Eurometal
