ArcelorMittal plans to introduce a premium for high-quality wire rod

The company told European customers that products made using DRI would be subject to an additional markup

Global steelmaker ArcelorMittal intends to introduce a premium on new European contracts for high-quality wire rod produced using direct reduced iron (DRI). This was reported by Kallanish.

Currently, the company is the only European producer of high quality steel with an integrated DRI-EAF plant in Hamburg, which operates on Midrex technology.

The use of DRI in the production of high-quality products will increase their value in the future. The amount of the surcharge will be discussed with customers on a case-by-case basis, depending on the extent to which DRI is used in the order.

«Customers will have the opportunity to discuss the surcharge with their sales agents. This will give them the opportunity to assess the required specifications and the actual need for DRI to produce the order,» said a source familiar with the situation.

ArcelorMittal Hamburg’s annual DRI production capacity reaches 700 thousand tons, and steel production capacity reaches 1 million tons per year.

As GMK Center reported earlier, ArcelorMittal reduced steel production by 1.5% in 2023 compared to 2022, to 58.1 million tons. Iron ore production decreased by 7.3% y/y – to 42 million tons. Steel shipments for the year decreased by 0.5% y/y – to 55.6 million tons, and iron ore (AMCC and Liberia only) – by 5.7% y/y, to 26.4 million tons.

ArcelorMittal is a leading global steel and mining company with operations in 60 countries and production assets in 18 countries.