Energy costs can reduce plant production: Federacciai

Italian steel production could slow if electricity and gas prices continue to rise, the president of the Italian steel producers association Federacciai, Alessandro Banzato, said at a conference attended by assisted Kallanish at the Made in Steel trade fair on Wednesday in Milan.

“The recent increases in gas and electricity prices could slow down or undermine the positive trend of the Italian and European economy,” he observed.

Steelmakers and re-rollers are currently monitoring peaks in electricity consumption. The energy crisis is a European issue and a question of future tensions, they say. If the rise in energy prices continues, steelmakers will have to review their production costs. One possible action is to reduce CO2 costs and reduce CO2 quotas.

The Italian industrial association Confindustria is currently taking the issue to the government and the European Commission, Banzato said.

In the first eight months of 2021, Italian crude steel production amounted to 16.3 million tonnes, up 27.5% year-on-year and 6.1% per year. compared to the same period in 2019. In 2020, all end user sectors were strongly affected by the Covid. -19 pandemic. In the first half of 2021, most sectors improved, but only construction and household appliances returned to pre-pandemic levels, according to Federacciai.

The association has noticed a strong rebound in the pandemic despite looming clouds of energy pricing.

” The raise of [sales] volumes was accompanied by strong growth in turnover, driven by the tenacity of demand and the sharp increase in the cost of raw materials ”, commented Banzato. “This effervescence in demand has resulted in an apparent shortage of material which, combined with the renewal of EU safeguard measures in July, has sparked an inevitable controversy between producers, steel processors and traders.”

“First of all, it is good to remember that the European safeguard measures are the consequence of duties on most steel products by the American administration in 2018”, he continued. “Although reflections and discussions have been initiated by the new Biden administration on tariff easing, at the moment the so-called Section 232 is still active and, therefore, as the EU recently expressed , the safeguards remain in place. ” If the American restrictions are lifted, the association will be open to a possible relaxation of guarantees, he added.

The strong rebound in the steel sector from the pandemic is an expansive European-wide cycle destined to last for a few years, Banzato said. This is a positive trend which will become even stronger when investments from the European recovery fund boost infrastructure.

Nathalie Capra


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