This decision is due to two factors: low demand for coke and high coking coal prices
ArcelorMittal Poland, the Polish division of global steelmaker ArcelorMittal, is putting a coke oven battery at its Krakow plant into hot mothballing mode. This is stated in the company’s press release.
«After a thorough analysis of all options, the company decided to adapt the level of coke production to difficult economic conditions. ArcelorMittal will start the hot shutdown of the coke battery in Kraków,» the statement said.
This decision is due to two factors: low demand for coke and the ratio of coking coal price to coke price. According to HIPH estimates, apparent coke consumption in Poland decreased by 36% y/y.
«The current coke market conditions do not allow us to fully utilize our production capacity. Demand for coke has dropped significantly, but we are also dealing with an unprecedented situation in the coke industry – the price of coking coal fluctuates around the price of coke, which makes production unprofitable,» explains Wojciech Koszuta, CEO of ArcelorMittal Poland.
Until the end of 2023, all employees of the coke plant will continue to work to prepare the coke battery for a safe shutdown. During this time, the company and its social partners will work together to develop solutions for further employment for the unit’s employees.
As GMK Center reported earlier, coking coal prices have been growing since the beginning of September, reaching $345/t FOB Australia at the beginning of November. Prices were supported by the low availability of raw materials at the same time as high demand. Currently, the supply situation has stabilized, so prices have fallen to $310/t FOB Australia.