Top 10 Hot Spots of Global Steel in 2023

1. Japan Steel Announces Acquisition of U.S. Steel Company

On December 18, Nippon Steel announced plans to acquire U.S. Steel in cash and turn it into a wholly-owned subsidiary at a transaction price of $55 per share, with a total amount of about $14.9 billion. Based on the closing price of U.S. Steel's stock on December 15, the acquisition premium is about 40%. U.S. Steel's share price rose 26% to $49.59 a share on the day on news of the high-priced acquisition. Nippon Steel did not explain its willingness to buy U.S. steel companies at a significant premium. As the world's fourth largest steelmaker, Nippon Steel's acquisition of U.S. steel companies will greatly increase crude steel production capacity, while significantly increasing production capacity in the United States. The acquisition is expected to close in the second or third quarter of 2024, and the related transaction is still subject to approval by the Committee on Foreign Investment in the United States.

In addition, Japan Steel promised to respect all collective bargaining agreements reached by U.S. Steel and the United Steelworkers, but the acquisition was still resisted by the latter. According to the agreement reached between the United Steelworkers and U.S. Steel, the United Steelworkers has no right to block the acquisition if the acquirer promises to maintain the existing labor agreement.

2. The EU carbon border regulation mechanism officially entered the transition period

UK 'carbon tariffs' will follow

Since October 1, 2023, the EU carbon border adjustment mechanism (CBAM) officially entered the transition period, according to the provisions of the transition period will last until the end of 2025, 2026-2034 gradually fully implemented. The first reporting quarter of the transition period is from October 1 to December 31, 2023. Importers need to submit the report to the EU CBAM transition registration office before the end of January 2024 to enjoy the relevant policies. On December 22, the European Commission published the default values for implied emissions that can be used to determine the imported goods (except electricity) covered by the CBAM transition period. The default values will be revised periodically after the end of the first reporting period in the fourth quarter of 2023.

On December 18, the British government officially announced that it would implement the British carbon border adjustment mechanism from 2027. The initial product categories covered includeAluminum,Cement, steel, etc. The UK's carbon border adjustment mechanism implements rules similar to those in the EU, and goods imported into the UK from countries with low or no carbon price must pay a carbon tariff. The UK government will conduct further consultations on the specific terms of the carbon border adjustment mechanism in 2024.

Setting up "carbon barriers" in the name of curbing carbon emissions is becoming a common practice in developed countries and regions. In September of this year, He Yadong, a spokesperson for the Ministry of Commerce of China, responded to the EU CBAM, saying that relevant policies should comply with the basic principles and rules of the WTO and avoid constituting protectionist measures and green trade barriers.

3.COP28 Releases * New Edition of Steel Standard Principles

On December 5, * the new steel standard principles were officially released at the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP28) "Steel Standard Principles: Unlocking Decarbonization, Trade and Global Markets. This indicates a deepening of the global commitment to promote the measurement and tracking of emissions from steel production. At present, 42 advanced standard-setting organizations, enterprises, industry associations and international organizations have officially recognized the new steel standard principles. * The main contents of the new steel standard principles include that the measurement methods of near zero carbon emissions in the steel industry should be fair and just, and reflect the actual situation of different countries.

4. The pace of investment and development of the Simandou project in Guinea is accelerated.

In the second half of 2023, the Simandou project in Guinea will be further promoted.

On August 10, the Government of the Republic of Guinea, Rio Tinto Simfer and Win Alliance, as members of the Trans-Guinean Company, signed the Agreement on the Joint Development of Port and Railway Infrastructure for the Simandou Iron Mine, marking a key step in the development of the Simandou project.

In late August, Wrigley Minerals revealed that the company would be involved in the Simandou project to consolidate its position in West Africa. Foreign media reported in mid-December that the company has restarted field work and plans to start drilling in March 2024.

On October 7, Baowu Resources and Simandou Win Alliance signed a confirmation letter of shareholder agreement of the mining joint venture company of Simandou North Block Project in Baowu Building. Since the beginning of this year, China Baowu and Simandou Win Alliance have sincerely cooperated, successively signed mining and infrastructure cooperation agreements for the Simandou northern block project, and jointly promoted relevant partners to sign important cooperation documents such as the Joint Development Agreement. It has laid a good foundation for the integrated and coordinated development of mines, railways and ports in the Simandou project.

On December 6, Rio Tinto announced that it would operate in Simandou, Guinea.Iron OreThe project is being brought forward to 2025 and plans to spend about $6.2 billion on infrastructure.

5. Hydrogen metallurgy helps the global steel industry to reduce carbon depth.

In 2023, the global steel industry will continue to promote the transformation of "carbon metallurgy" to "hydrogen metallurgy" and accelerate the low-carbon transition.

On March 1, ThyssenKrupp and Simac signed a contract in Duisburg, Germany. Simac will design and build a hydrogen direct recovery plant for ThyssenKrupp Duisburg Steel Plant, which is scheduled to be completed by the end of 2026. On July 7, ThyssenKrupp New Era Company, a subsidiary of ThyssenKrupp's hydrogen business segment, was listed on the Frankfurt Stock Exchange (Advanced Market).

On May 31, India's steel ministry allocated about $55 million to its steel industry to support research into hydrogen metallurgy and build a pilot plant.

On July 19, ArcelorMittal's Spanish Sesto Plant, in cooperation with Sara Metallurgical and Japan Natural Gas Company, put into operation a ladle preheating system that can use 100 percent green hydrogen as fuel using Sara Metallurgical's technology.

On September 5, the Swedish steelmaker Ovaco officially launched the world's first electrolysis hydrogen production plant that does not use fossil fuels, built in Hofoss, Sweden.

In mid-October, the U.S. Department of Energy announced that it would spend $7 billion million to launch seven regional clean hydrogen centers in the country, which are expected to produce 3 million tons of hydrogen per year. The goal is that by 2030, the seven centers will produce nearly one-third of the total U.S. production.

On November 6, Africa's first industrial-scale zero-carbon steel production project using green hydrogen broke ground in Namibia and is scheduled to start production by the end of 2024.

On November 27, the "South Korea Economic News" reported that South Korea Posco Holdings Group plans to build three hydrogen direct reduction systems at Posco Steel Plant and Guangyang Steel Plant by 2050.

In addition, the hydrogen metallurgy practice project of Chinese steel companies represented by China Baowu and Hegang Group has attracted widespread global attention. Edwin Basson, Director General of the World Steel Association, praised it for "promoting the formation of green and low-carbon development in China's steel industry. Advantage".

6. Acceleration of global research and development of advanced steel products and production technologies

In 2023, the production and research of global steel enterprises will continue to speed up.

In early January, the German subsidiary of the Swiss Steel Group announced the development of XTP, which does not require alloying or special heat treatment to produce ultra-fine grained, ultra-high strength steel.®Process. This process can produce very fine-grained steel with a grain size of less than 5 microns, which can increase the tensile strength of the steel to 2050 MPa.

In June, Posco Holdings Group launched its first carbon emission reduction brand product "Greenate Certified Steel" in South Korea to achieve carbon emission reduction through the introduction of low-carbon production processes and the use of low-carbon iron source materials. In late November, it successfully developed a stainless steel lining technology using dual-phase steel with excellent corrosion resistance and corrosion resistance. Duplex stainless steel was used as the lining material of the water tank, which improved environmental protection.

On October 31, Kobe Steel Co., Ltd. used * good component design and TMCP technology to develop fatigue-resistant steel plate "EX-Facter" steel plate for the first time in the industry to inhibit cracking and realize commercialization.

At the end of November, South Korea Dongguo Steelcold rollingBusiness subsidiary Dongguo Coating Metals Company successfully developed the world's first technology to produce color steel plates from recycled waste plastics-recycled green PCM color steel plates (RebornGreenPCM).

In addition, in 2023, Chinese enterprises also achieved a number of advanced steel products in the world. For example, in the first half of this year alone, Baosteel achieved the world premiere of 7 products including 1500 MPa DP ultra-high-strength automotive panels.

EU extends suspension of retaliatory tariffs on US products

On December 19, the European Union said it would suspend its dispute with the United States over steel and aluminum tariffs until March 31, 2025. In exchange, the United States agreed to provide further tariff exemptions for EU exporters.

In 2018, then US President Trump imposed tariffs on EU steel and aluminum products on the grounds of "safeguarding national security. After many unsuccessful negotiations, the EU appealed to the WTO and imposed retaliatory tariffs on US exports to Europe. After several rounds of negotiations, the European Union and the Biden administration of the United States reached a two-year "truce" agreement in October 2021, announcing the reconstruction of steel and aluminum trade relations and the suspension of mutual taxation. The United States partially lifted its restrictions and imposed tariffs only on some goods exceeding a specific quota, while the European Union "froze" all its restrictive measures.

8.steel scrapBegin to be regarded as a strategic resource by many countries (regions)

Since the beginning of this year, many countries (regions) have introduced a series of measures around scrap steel, regarding scrap steel as a strategic resource.

On January 17, the European Parliament voted to amend the "Waste Transport Regulation" to prohibit the transportation of all waste for solid waste disposal within the EU unless authorized. Eurostat data show that steel scrap accounts for 59% of all waste exports in the EU.

In early October, the UAE government issued an extended ban on steel scrap exports to ensure sustainable access to raw materials for local producers. The UAE Ministry of Economy announced in accordance with Ministerial Resolution No. 06 of 2023 that the export of scrap steel and waste paper will be temporarily suspended as required by the public interest. The measure will be implemented until December 19, 2023, extending the previous ban that was originally scheduled to expire on September 21.

Kazakhstan's Interfax News Agency reported on October 26 that Kazakhstan has extended the export ban on ferrous and non-ferrous metal scrap for another six months from November 7.

In mid-November, Russia plans to extend the tariff quota period for scrap steel exported to countries outside the Eurasian Economic Union until June 30, 2024.

Scrap steel has gradually become a "sweet pastry". According to incomplete statistics, more than 60 countries (regions) have taken or planned to take measures to prohibit or restrict the export of recycled steel.

Ukraine to Resume Part of Steel Production

In 2023, Ukraine will resume some steel production and reorient its trade to the European market. Although the threat of geopolitical conflict remains, Ukraine's steel production began to pick up this year. New data from the Ukrainian Steel Trade Association * show that Ukraine's crude steel production in the first 10 months of 2023 was 5.16 million tons,pig ironThe output is 4.91 million tons and the steel output is 4.37 million tons.

In January of this year, Ukrainian Prime Minister Shimegar once again called on Western countries to provide him with reconstruction assistance worth 70 million U.S. dollars. On June 21-22, the International Conference on the Reconstruction of Ukraine was held in London. According to VOA radio reported on the same day, the British government said that the focus of the meeting included calling on about 60 countries to provide assistance to Ukraine in technology, logistics and infrastructure.

Some scholars said that although Ukraine's steel industry has achieved a certain recovery, the overall recovery still faces multiple challenges.

10. Overseas steel enterprises, mining enterprises to stop production and strike incidents

In the context of slowing global economic growth, soaring energy prices and production costs, and high inflation, there have been frequent strikes by workers in overseas regions this year and the suspension of steel mills.

From May 24 to October 5, the employers and employees of Posco Holdings Group negotiated 24 times on wages and benefits, but failed to reach an agreement. During the mediation, POSCO union members also approved the strike with 75 percent approval. On October 30, the chairman of the South Korea Central Labor Committee made an exception to participate in the mediation of disputes between employers and employees of Posco Holdings Group. In the early morning of the next day, the group's employers and employees reached a tentative agreement, which was passed in a vote held on November 9, introducing benefits such as four-day work every other week.

On 17 November, ArcelorMittal decided to temporarily suspend production at its BiH-Amizenica steel plant. On November 28, its South African company announced that it will gradually close its long products business in January 2024 and lay off about 3500 employees. Its Brazilian branch also announced in mid-November that it would temporarily suspend production at three steel mills in southeastern Brazil until the end of December.

On November 24, hundreds of train drivers at a BHP Billiton mine in Western Australia went on strike.

On November 27, ThyssenKrupp's Spanish subsidiary announced that it would close its Sagunto plant.

On December 12, about 68000 steel workers in the western German states of North Rhine-Westphalia, Bremen and Lower Saxony held a 24-hour strike. ThyssenKrupp and Starr, etc. Major steel mills operating in the country have all stopped work.