At the 51st annual meeting of worldsteel (World Steel Association) held in Brussels on October 16-17, Geert Van Poelvoorde, president of the European Steel Association (EUROFER) and executive vice president of ArcelorMittal, serving as its CEO of ArcelorMittal Europe Flat Products, stated that EUROFER’s objectives are almost identical to those of the OECD - open and transparent markets and a sustainable industry in the widest possible sense. He went on to say that the EU steel industry is still recovering from the worst crisis since the 1970s.
Nevertheless, they have been leading the way in developing new grades of steel. The EUROFER president also stressed that the EU steel industry operates in one of the most challenging environments in the world. It currently employs a workforce of 318,000, down 90,000 compared to before the crisis, but this is also in part the result of optimization. While steel demand in the EU has grown, it is still down significantly compared to 2007.
He went on to state that at the same time EU crude steel production has remained flat. The EU’s steel imports are now double what they were in 2012, while for the fourth year in a row, imports have grown more strongly than actual demand in the EU. On the other hand, as Mr. Van Poelvoorde remarked, the EU’s steel exports have declined by 40 percent in the period from 2012 to 2016, while they fell by 9 percent year on year in the first half of 2017. On the issue of global overcapacity, he said that all governments acknowledge the need for a global solution, adding that the steel industry will continue to suffer until such time as global capacity is reduced.
The EUROFER president pointed out that the reason why the EU is particularly affected is that it is a very open market, while stressing that EUROFER is simply asking for a level playing field rather than for antidumping measures. He added that the global solution that is needed will have to include countries where industries receive state support. While the EU steel industry advocates free trade, it has been forced to react.
Furthermore, while the EU Emissions Trading System (EU ETS) is close to being finalized, it will create enormous costs for the European steel industry and threatens to destroy the industry because of these additional costs. Van Poelvoorde recalled that the EU steel industry has cut its carbon footprint by half since 1970, while going on to stress that the ETS should have been designed to incentivize but will instead punish some of the world’s most-efficient producers, which is good news for non-EU producers. He also pointed out that steel imports coming into the EU can have a carbon output of up to 50 percent greater compared to EU products. As a result, the ETS, he affirmed, will lead to more imports with a higher CO2 output, and so the ETS will achieve exactly the opposite of what was intended.
Meanwhile, Mr. Van Poelvoorde said that the European steel industry is looking for ways to strengthen the circular economy and in this scope is seeking ever greater cooperation with other industries with different needs. He also placed emphasis on the importance of industry policy and smart regulation, adding that lower margins can impact the industry’s ability to invest. Concluding, he said that EUROFER’s priorities in 2018 would be the same as in 2017 - trade defense measures, support for regulation which will support the industry and promotion of the circular economy.