German steel giant facing more drastic changes?
German steel giant facing more drastic changes?

1 March 2024 – Is the German steel giant thyssenkrupp Steel Europe once again facing drastic changes? Are capacity cuts on the way? Familiar trade union circles are already drawing horror scenarios. What will happen to the 2 billion euros in subsidies from Berlin and Brussels? And the prices for stainless steel scrap in China and Europe continue to rise.

German steel giant facing drastic changes?

According to familiar information on the trade union side, the German steel manufacturer thyssenkrupp SE is once again facing drastic decisions. According to trade union sources, the Executive Board wants to reorganise the company at the urging of Thyssenkrupp AG and then let the steel division go independent.

Capacity reduction at thyssenkrupp?

Apparently, as unbelievable as it may seem, capacities at thyssenkrupp could be reduced. This would indeed be a novelty and possibly the only way to reduce CO2 emissions for German steel in the medium to long term. After all, the traditional blast furnace route has reached the end of its possibilities and should really be phased out.

It could also enable qualified workers, who are desperately sought after in the German labour market, to provide real added value elsewhere overnight. After all, the classic blast furnaces are a discontinued model.

After all, with an average of 730,000 job vacancies (since 2016) and 45.91 million people in employment in Germany, the shortage of skilled labour is more than evident. The narrative of fear of job losses at large German companies no longer works particularly well in the face of such figures.

thyssenkrupp Steel Europe on its own two feet?

The fact that German politicians, above all the German Federal Ministry of Economics and Climate Protection (BMWK), are to be triggered into typical actions and reactions with such targeted horror stories is already shown by the demand of 14 EU member states under German leadership for an extension of the EU Safeguard Measure on certain steel products beyond 2024. Although they know full well that the European market is already dramatically undersupplied.

The parent corporation once again wants to put the German steel producing part on its own feet, but has not yet presented a viable concept. And this after having just secured 2 billion euros in subsidies from the German state and the European Union. It makes you wonder what a multi-billion euro subsidy application looks like and how something like this is simply waved through by Berlin and Brussels without any viable concepts known in advance.

Stainless steel scrap continues to rise in price

Prices for stainless steel scrap in China and Europe have recently risen again. In China by more than 7% since mid-February, in Europe by more than 6% since January. In the EU in particular, prices for stainless steel scrap are currently at a significantly higher level, having been kept artificially low from mid-2022 until the end of 2023.

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