Steel is the heart of EU industry

Written by Andrés Barceló on 7 June 2018 in Opinion
Opinion

The steel industry is fully committed to the European values of the circular economy, sustainability, innovation, and free and fair trade, writes Andrés Barceló.

Photo credit: Press Association


Every year, the European steel industry’s stakeholders gather in Brussels for European Steel Day. This year, the gathering will take place on 7 June with the motto, ‘Steel, sustainability, and low-carbon innovation’.

Not only is steel the material of choice along the industry and construction supply chain - it is also the core of an industry that is fully committed to the European values of the circular economy, sustainability, innovation, and free and fair trade.

The steel industry, represented in the EU by Eurofer, is on the road to recovery after the financial and economic crisis that suddenly erupted almost 10 years ago. The figures speak for themselves: a drop of 28 per cent in demand for steel between 2007 and 2014 forced companies to lay off almost 20 per cent of their workforce. 


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The industry worked hard to survive and continue providing its customers with products and services, even as the market almost collapsed, and new challenges and threats - such as regulatory burdens, overcapacity and the spread of protectionism in many third countries - emerged in the business environment.

Today, the steel industry is present right across Europe, with more than 500 production sites, producing 160 million tons of steel, providing over 320,000 direct jobs, and generating millions of indirect and induced jobs, as shown recently by an Oxford Economics study.

The strong commitment of our industry to its workforce is one of the key factors explaining its survival and resilience in Europe: a highly educated workforce is vital to our industry, as productivity is key to competing in the international arena. 

Steel offers long-term employment with continuous professional development, which translates into one of our best achievements: staff turnover is in the lowest quartile of the European labour market.

28 April is the World Day for Safety and Health at Work, prominently marked by steel companies across Europe by means of their participation in various activities. Nevertheless, it is important to note that safety is not just a priority but an obsession for the steel industry, and not only on this particular day, but every day. 

Manufacturing steel used to be a very risky activity but thanks to the strong commitment of the whole steel community, from top executives to contractors, safety indices have improved dramatically. At UNESID, my own organisation, and in many steel companies, every board meeting begins with a discussion on the latest safety indices. 

Steel is at the heart of the circular economy. As is the case with other metal industries, our product is endlessly recyclable, with a very efficient market for the secondary raw material of ferrous scrap, a market that requires no public intervention or financial support. 

Market forces drive the collection and recycling of ferrous scrap, making the steel industry the largest recycling industry in Europe, surpassing the other industrial recycling sectors put together.

Our by-products - mainly slag and mill scale - have many applications, reducing their environmental impact and providing an excellent example of the circular economy.

The European steel industry now faces unexpected threats due to global overcapacity in the steel industry and recent measures taken by the US government, which could jeopardise the cautious recovery achieved in the EU steel market. 

We are grateful to the Commission for launching ex officio a safeguard investigation so as to combat the risk of excessive imports into the EU market - which is, by far, the most open and free around the globe.

Our industry does not want to close the market: on the contrary, we are free traders and we welcome competition, as we are confident in our performance and competitiveness. In fact, we would like to have the same access to third-country markets that our competitors enjoy in the European market.

We are aware of, and grateful for, the outstanding work the Commission is doing to cope with global excess capacity, and its leadership within the G20 Global Forum on this issue. In this field, as in others, European policymakers have been global leaders, as we have the strongest state aid rules that prevent public support for industries that cannot withstand market forces. 

Steel is a highly energy-intensive industry. Energy is an essential input into steel production (reducing iron ore or melting scrap), meaning that energy efficiency is at the core of our industrial development. We hope that current work under the winter package will provide a realistic framework to guarantee a stable, competitive and predictable energy price for our industry. 

As is the case with every business within Europe, the steel industry has many challenges that need to be dealt with; but this year we would like to proudly show European society, represented by its institutions and our stakeholders, our commitment to the sustainability of the industry and the European economy and jobs, as well as our strong emphasis on innovation in order to move towards a low-carbon economy. 

We believe that we are on the right track, but we still have a long way to go. We need public support and a stable regulatory framework that provides legal certainty so that the EU continues to be a good place to invest in and develop our industry.

We are looking forward to seeing you in Brussels on 7 June for European Steel Day.

 

About the author

Andrés Barceló is a member of the EESC’s employers’ group

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