All European steel manufacturing sites threatened with closure by 2025? The new boss of steelmaker ArcelorMittal France issued a severe warning on Wednesday to French and European politicians.
“The steel industry in Europe is in crisis (…) the sites, whatever they may be, are all at risk in Europe and therefore in France too,” declared Alain Le Grix de la Salle, during a parliamentary hearing in Paris.
In Germany, it was the shock announcement at the end of November of the elimination of 11,000 jobs by 2030, or a third of the workforce, by the steelmaker Thyssenkrupp which left its mark, with Chancellor Olaf Scholz not having ruled out participation of the State in the capital of the German steelmaker.
In France, ArcelorMittal plans to close two small sites in the spring, and on November 26 suspended its massive investment projects for the decarbonization of its production in Dunkirk and Fos-sur-mer, i.e. 1.8 billion euros including 850 million in public aid. This fuels doubts about possible relocation of activities which would ultimately lead to site closures.
On Wednesday, the president of ArcelorMittal France, who took office three months ago, painted a very dark picture of the steel crisis in Europe before French deputies, repeating the speech and fears of his predecessor.
While the European Union was created from the pooling of coal and steel in 1952, the steel industry is now threatened by the excessive cost of energy, by Chinese overproduction of steel, the high level of low-cost imports and the lack of domestic demand, he said.
– “Conditions of fair competition” –
“The steel industry in Europe and therefore in France has entered a major and serious crisis. Global overcapacity is a structural phenomenon that will last. This overcapacity currently represents 550 to 600 million tonnes of annual production, or 4 to 5 times production of Europe,” he enumerated.
“To talk only about China, it exported 100 to 120 million tonnes last year. This is the equivalent of all European consumption,” he said.
“The United States protects its industry by all means. That leaves Europe. Steel travels. We are not against imports. We ask that they be limited and that they do not have a devastating effect on our industries as currently. We demand conditions of fair competition, particularly regarding the cost of CO2,” he added.
-“If Europe does not decide to protect its market from unfair competition, then entire sections of our industry will disappear in the short term. This is not catastrophism, it is unfortunately pure and simple reality “, launched the manager.
At the beginning of December, the European steel union Eurofer issued the same warning, sending appeals for help to Brussels.
On the same date, Lakshmi Mittal, the boss of ArcelorMittal, the world's second largest steelmaker, estimated in an article in the Financial Times that “the European steel industry has never experienced a greater challenge”.
On Wednesday in Davos (Switzerland), where the World Economic Forum is being held, Mr. Mittal met Stéphane Séjourné, vice-president of the European Commission, responsible for industrial strategy.
He assured him that “support for the European steel industry is one of the priorities of the Commission” which will present “an emergency plan for the sector soon”, according to Mr. Séjourné's entourage.
Mr Le Grix de la Salle told French MPs that he was expecting a European steel plan for the month of March.
Steelmakers expect an established and effective carbon border adjustment mechanism, and reinforced trade safeguard measures.
A ray of hope, depending on expected European support measures, the ArcelorMittal group hopes to be able to make its decarbonization investment decision “during the second or third quarter”.
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