ArcelorMittal adds €50 surcharge on European longs products
ArcelorMittal plans to introduce a €50 ($58) surcharge on all of its long products in Europe in order to account for sharply rising energy prices, an official with the Luxembourg-headquartered group said.
Stay up to date on MetalMiner with weekly updates – without the sales pitch. Sign up now.
ArcelorMittal introduces new surcharge
“The price rise is temporary and primarily in response to the record rise we have seen in energy prices,” a spokesperson for the group said in a statement to MetalMiner.
The source did not say when exactly the surcharge would come into effect, except that it would “pretty soon.”
He also did not indicate how long the surcharge would last, saying that it would depend on energy prices.
The restart of national economies after the COVID-19 pandemic, Europe’s longer winter season in 2020/2021, plus competition from East Asian companies have seen gas prices rise several times year over year, an Oct. 5 report from Euronews stated.
Storage volumes in Europe are also down to slightly over 75% as of Oct. 1, compared with almost 97% on the same date in 2020, the Euronews report added.
The end-of-day price for gas reached €114.30 ($132.25) per MWh at the Dutch TTF hub on Oct. 6, up by one-third on the day from €88.03 ($101.85) and 170% from €41.86 ($48.43) on Aug. 24, information from the European Energy Exchange shows.
That price has eased and was €92.77 ($107.33) on Oct. 8, following Russian gas supplier Gazprom’s assurance that it would exceed contract stipulations and increase exports to Europe via Ukraine.
One steel trader believed that the market would have to accept ArcelorMittal’s surcharge and, thus, further increases.
“I think that the market was expecting a price decrease. But seeing that [ferrous] scrap prices in Turkey are going up, I think that they have to accept it,” he said of the surcharge.
Rebar in Europe was €780 ($895) per metric ton exw last week, the trader said, down from about €800 ($925) in late September.
ArcelorMittal Europe produces rebar, wire rod and other bar products in Bosnia-Herzegovina, Poland, Germany, Spain, France and Morocco.
Long products shipments by the group in Europe totaled 4.69 million metric tons in H1, up 11% year over year from 4.22 million metric tons, information from the group’s Q2 report indicated.
Become part of the MetalMiner LinkedIn group and stay connected to trends we’re watching and interesting metal facts.
Leave a Reply