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September 3, 2021 – The green transformation in Europe is coming. But so far no one knows where the energy and hydrogen will come from. A German steel mill alone would need 3,000 wind turbines to meet its energy needs. Will Chinese anti-dumping duties on Indonesian stainless steel imports be dropped? And a new study concludes that the cost of the EU Carbon Border Tax CBAM will ultimately be paid by European consumers.

Stainless Espresso: More than 3,000 wind turbines for an EU steel mill?
Stainless Espresso: More than 3,000 wind turbines for an EU steel mill?

Will Chinese anti-dumping duties on Indonesian stainless steel end?

Rumors are circulating in the Chinese stainless steel market that anti-dumping duties on Indonesian stainless steel imports could fall. However, there is no official announcement on this yet. Market voices believe that the AD measures could fall due to efforts to reduce CO2 emissions.

China imported more than 1.81 million tons of stainless steel in 2020

China imported more than 1.81 million tons of stainless steel in 2020. An increase of more than 63% compared to 2019, a possible removal of anti-dumping measures on Indonesian stainless steel could mean imports to China will continue to increase, making Indonesian stainless steel scarcer elsewhere.

Green steel: Soon 3,000 more wind turbines in Duisburg?

The ailing German steelmaker thyssenkrupp is planning to convert its four major blast furnaces to green energy. According to the group’s own calculations, this would require more than 3,000 wind turbines, as the steel mill in Duisburg alone would need one million tons of hydrogen from sustainable production per year. The power plant capacity required for this would cost 40% of the total capacity of the German electricity supplier RWE.

Energy for hydrogen simply not available

No one can or wants to answer the question of where this amount of hydrogen is to come from by 2030. Natural gas is to be used as an interim solution. It’s just as well that there is enough natural gas and that the Nordstream 2 natural gas pipeline, for example, is completely uncontroversial – or not.

Fittingly, Centrica, the owner of British Gas, warns today that natural gas prices will rise due to problems in the global supply.

8 billion euros from German taxpayers

The cost of converting the four Dusiburg blast furnaces to run on hydrogen is estimated at 8 billion euros. According to information in the magazine Spiegel, thyssenkrupp has not yet decided on its own share. This means that the 8 billion euros will apparently be paid by German citizens. It’s a good thing it’s an election year and the SPD, above all Chancellor candidate Olaf Scholz and Federal Environment Minister Svenja Schulz, are busy handing out campaign gifts, including to German steelmaker thyssenkrupp.

Blueprint for German steel industry?

In any case, thyssenkrupp already sees itself as a pioneer in the green transformation of German and European steel and wants to become the blueprint for the changeover. Apparently, the blueprint currently looks like the costs will ultimately fall on the German taxpayer and no one knows where electricity and hydrogen will come from. But then, there’s plenty of natural gas for the transition…. not.

Study: Costs for CBAM will be paid by the consumer in the end

The European Commission’s “Fit for 55” plan includes the introduction of a Carbon Border Adjustment Mechanism (CBAM). CBAM is intended to ensure that European industry is protected from dirty and non-CO2 neutral imports, such as steel, cement or fertilizer, from other EU countries. In the future, CO2 taxes will be due on imports, which manufacturers will have to pay and thus be forced to produce in a greener and cleaner way.

CBAM protects only 3.2% of EU industry

A recent study by Sandbag and E3G now concludes that CBAM costs will ultimately end up primarily with the EU consumer, because importers will pass on the rising costs. And the overall effect of CBAM will be rather small. Just 3.2% of total EU imports are affected by CBAM – in return, the protected companies, such as EU steelmakers, receive 47% of the free emissions allowances.

EU CBAM only market protection measure?

This raises the question again: Is CBAM really an instrument to protect the environment or just a new market protection measure to protect the domestic steel industry?

And what moves you today?

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