Steel production fell 19% due to high gas and electricity prices

The steel industry last year cut its steel production gross in Spain by 19%, after reaching 11.5 million tons and losing more than 2.6 million due to high electricity and gas prices.

The general director of the sector’s employers’ association (Unesid), Andrés Barceló, pointed out that production fell to practically the same level as in 2020, “when covid paralyzed industrial activity”. Barceló stressed that the prices of electricity and gas “caused this deterioration, particularly damaging exports, which in Spain fell even more than sales.”

That’s because of the drop in production in recycled waste also fell by almost 20%, slightly more than 8.9 million tons, the data is even slightly lower than that of 2020. Used scrap is equivalent to 77% of steel production.

As for deliveries, last year 11.9 million tons steel products, which represents a decrease of 13% compared to 2021 as a result of the deterioration of the foreign market (-18%), especially the non-EU market (-28%). On the other hand, in Spain, the decline was more limited (-8.7%) after the delivery of 6.4 million tons.

Likewise, demand for steel products fell 4% to 12.4 million tonnes, with the decline more intense in the fourth quarter, a loss of 14% compared to the same period in 2021.

Imports from countries outside the European Union increased their market share, reaching 31% of apparent consumption, the highest value in the entire series.

As for imports of steel and products of the first conversion, they fell by 3% to 9.8 million tons, with a decrease of 7% in European imports and a 4.3% increase in imports from Europe outside the EU, which reached 4 .2 million tons (43% of the total), the highest value in the last 15 years.

On the other side of the scale, exports reached 8.1 million tons, 14.3% less, where the drop in the non-EU market is particularly noteworthy, with a drop of 24%.

During 2022, the trade surplus fell by 85% to 102 million euros after the deterioration of the balance with third countries. So, if it is counted in tons, there is not a surplus but a deficit, which has practically tripled to almost 1.7 million tons.

Looking ahead to this 2023 year, Barceló stated that the financial year “started the same way it ended in 2022.” and assured that the forecasts “do not call for optimism, with uncertainties that are not in favor of industrial activity”.

However, he was confident that the steel sector throughout the year “can improve its prospects for facing future challenges, particularly decarbonisation”.