The Italian government will stimulate the production of stainless steel based on scrap metal

The Italian government will encourage flat stainless steel producers to prioritize scrap-based production, according to Umbria24.

According to Valentino Valentini, Italy’s Deputy Minister of Enterprise and Production, the 2026 budget law provides for an annual allocation of €35 million (until 2028) as a subsidy for companies that produce stainless steel, mainly using scrap and recycled materials. This measure is aimed at supporting highly energy-efficient processes for the production of stainless and special steel in electric furnaces.

The goal of this step is to promote decarbonization and energy conservation in production processes, which will lead to a reduction in energy consumption by companies.

As Kallanish notes, eligibility for aid is determined by specific energy consumption and product requirements. These include a minimum scrap or recycled material content of 90% or 70% for special grades, as well as compliance with energy efficiency thresholds, which will be tightened over time.

Aid is granted to producers of stainless steel smelted from scrap in electric furnaces, whose average annual electricity consumption per ton remains below the thresholds set for 2025, 2026, and 2027. It can be combined with other forms of support related to production costs.

The measure is also intended to limit imports of high-carbon Asian stainless steel semi-finished products from Asia.

It should be recalled that Italian steel companies increased steel production by 3.6% in 2025 compared to 2024, to 20.7 million tons. Flat steel production for the period increased by 3.8% compared to 2024, to 8.9 million tons, and long steel production increased by 5.5% year-on-year, to 12.3 million tons.