Assofermet: Without Ilva EU measures on imports will make less sense

by Hans Diederichs

An invitation to calm and an appeal to everyone’s sense of responsibility – this sums up the words spoken by Riccardo Benso, president of Assofermet, the Italian association of local steel and scrap distributors, during the EUROMETAL SSC Regional Meeting Southern Europe held on November 21 in Milan. “At the moment it is very premature to imagine a solution” for the Ilva case, said Mr. Benso. “We have to give all players the necessary time to handle this complicated issue. But I would invite everyone to maintain calm and to respect each other”. This recommendation was addressed not only to the parties involved in the Taranto plant crisis, but also to steel distributors and producers.

Between these two sides, “there are without any doubt points of conflict,” said Mr. Benso, referring in particular to the issue of import measures. “No one says that we must leave our doors open, but we must understand that there are worlds within the supply chain that live on these import flows”, he added Mr. Benso. Hence, the need to “understand the other side’s reasons, find points of equilibrium and to work on what we agree on,” he said.

Interviewed on the side-lines of the event, the Assofermet president stated that the unpredictability of the Ilva case “is already supporting an increase in prices in the market, although this is also due in part to international factors”. He said he expects that in the short term there will be a slight shock relating to received orders and presumably delays in deliveries, though “the market has already moved and will move to find a solution” in the short term. In the medium-to-long term, everything will instead depend on the decisions that will be reached on the Ilva situation.

“If the outcome is Ilva producing 3.0-4.5 million metric tons, then the impact will be quite insignificant compared to what has happened in the past 12 months… If, on the other hand, Ilva’s output is reduced further, then we will see important distortions that will have to be addressed, especially considering that in a market like Italy there is strong demand for coils for structural reasons,” he stated. Consequently, according to the Assofermet president, the closing of markets, the quotas and the safeguards will make even less sense, especially for a product like hot rolled coils.

Riccardo Benso then criticized the European Steel Association (EUROFER) for its recent comments on the need for further safeguard revisions, judging them “inappropriate” at a time when the crisis of the largest integral-cycle plant on the continent could very well result in “a strong reduction in production and therefore a shortage situation”. Benso went on to say that he is aware of the fact that producers’ and distributors’ positions are diametrically opposed, but he wanted to underline that this is not the time to do battle: “Let’s wait. Let’s try to understand the situation. There are important players who must have the right to organize themselves, to find supplies that could be delayed or not be available at all”.

In the scenario of a European steel market without Ilva or with Ilva producing much less than usual, “We will all have to make an organizational effort and to find solutions, talk to the European Commission to make it clear that it is necessary that certain restraints have to be removed so that European buyers have their freedom back”.

Source and photo: EUROMETAL            

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