The FT is reporting that Steelmakers back challenge to EU rules (Peter Marsh) ArcelorMittal, ThyssenKrupp and Tata Steel are throwing their weight behind action by trade body Eurofer. Head of Eurofer and CEO of Voestalpine said that the way the EU commission has interpreted rules around carbon dioxide trading will give an unfair advantage to steelmakers in other regions.
According to Eurofer’s the commission’s interpretation of the regulations threaten to push the benchmarks for steelmaking too high. They say correct interpretation of the rules would result in an increase of 7 Euro/tonne of steel, and that the commissions interpretation will result in a cost of 12 Euro/tonne. This compares with the stated operating profit of 50 Euro/tonne.
12 Euro/tonne is equivalent to 1.4bn Euros (1.24bn UK pounds) and might be difficult to pass on to customers such as in the car industry. Figures above suggest a total profit of 5.83bn Euros (5.2bn pounds, 8.4bn US dollars, 55bn Chinese Yuan) for steel production in the EU, and a total steel production of 117 Mt.