Czech Republic reduced steel production by 21.1% y/y in 2023

The sharp drop in the indicator is caused by problems at the Liberty Ostrava steel enterprise

In 2023, Czech steelmakers reduced steel production by 21.1% compared to 2022, to 3.4 million tons. The country was thus ranked 39th in the global ranking of steel producers by WorldSteel, according to the association’s report.

The Czech Republic has two steel enterprises: Trinecke Zelezarny, with an annual capacity of 2.8 million tons of steel and 2.1 million tons of pig iron, and Liberty Steel Ostrava (3.6 million tons of steel per year, 2.1 million tons of pig iron per year).

The sharp decline in steel production in the country is likely due to problems at Liberty Steel. Since October last year, the company has suspended its only operating blast furnace No. 3. The unit’s downtime was scheduled for two weeks due to insufficient demand for products in the EU. During this period, it was planned to maintain full employment and fulfill customer orders as the rolling mills remained in operation.

Later, it turned out that Liberty Ostrava had debts to energy supplier Tameh Czech. The only energy supplier for the steel plant was on the verge of bankruptcy. On December 21, 2023, production at the plant came to a complete halt as Tameh stopped supplying electricity to the company.

Since then, the employees of the plant and the energy supply company Tameh Czech (about 6,000 people in total) have been staying at home, and most operations have been suspended. The date of return to work for the plant’s employees has been postponed several times. According to Patrick Schober, a spokesman for the energy supply company, Liberty is showing very little activity in resolving the situation.

Thus, the situation at Liberty Ostrava will continue to have a negative impact on steel production in the Czech Republic in early 2024, as the country’s largest steelmaker remains shut down and the date of its return to work remains unknown.

Overall, steel production in the EU countries decreased by 7.4% in 2023 compared to 2022 – to 126.3 million tons.

As GMK Center reported earlier, in 2022, the Czech Republic reduced steel production by 11% compared to 2021, to 4.3 million tons. Thus, the country’s steel industry has been showing negative results for the second year in a row. In 2021, steel production by Czech steelmakers increased by 7.9% y/y – to 4.8 million tons.