Salzgitter has seen a significant stabilization in steel demand while sentiment has improved considerably, according to comments made by group chief executive officer Heinz Jörg Fuhrmann.
Speaking at an online event by the Düsseldorf economic journalists’ association on Feb 23, Fuhrmann noted that German steel producers were expecting consumption to continue rebounding through 2021, although higher iron ore and ferrous scrap prices would provide some headwinds for the industry.
He added that the steel supply chain was relatively “empty” and this would continue for a while, with relatively tighter supply having led to a sharp increase in steel prices among other things meaning 2021 “should in all probability be a very good year for steel”.
That said, Fuhrmann stated that the recent improvements have not changed underlying structural problems related to the high import penetration into the European steel industry, meaning local mills have benefitted less from the demand recovery.
Salzgitter recently declared force majeure on steel shipments in response to heavy winter weather which had forced the closure of the Salzgitter-Beddingen freight station, with trains jammed throughout the rail freight network, according to a letter addressed to customers on Feb 15.
Fuhrmann, who will step down at the end of June 2021 after 10 years at the helm, said that Salzgitter plans to invest €1bn in the conversion to carbon-neutral steelmaking by 2030 and a total of €3bn by 2050. He noted that the move of the entire industry away from coal would require billions in funding which Salzgitter alone cannot finance.