Dublin, Nov. 16, 2023 (GLOBE NEWSWIRE) -- The "European Green Steel Market: Insights and Forecast (2023-2028)" report has been added to ResearchAndMarkets.com's offering.
The European green steel industry is projected to develop in the future as European steelmaking rivals such as Germany's Thyssenkrupp and ArcelorMittal consider utilizing hydrogen to replace coking coal. With demand growing fast, green steel providers are likely to benefit from a very tight supply/demand balance over the next decade, with considerable profit upside forecast. However, as supply expands and green steel becomes the standard, price power is expected to dwindle. Europe's green steel market is expected to reach US$76.97 million by 2023, growing at a CAGR of 75.24% during the forecast period.
The outlook for green steel demand has positively surprised over recent years with a larger range of end users than projected. It is clear that demand for green steel has spread into many more end sectors than was anticipated. Green steel demand is ultimately driven by a mix of two primary drivers: Scope 3 emissions reduction objectives and end-user demand. Green steel market demand in Europe is expected to reach 3.68 million tonnes in 2023.
Segmentation Overview:The report provides insights into the European green steel market through two key segments:
Type: The market is categorized into two types: Molten Oxide Electrolysis (MOE) and Electric Arc Furnace (EAF). MOE dominates the market due to its elimination of coking ovens and blast furnaces, using an electrolyte solution to reduce iron ore into liquid form. EAF is expected to have the highest future growth rate, with the potential to significantly reduce carbon emissions.
End Users: The market is segmented into four end-user segments: Automotive, Construction, Electronics, and Other End Users. Automotive is the largest segment, with automakers increasingly using green steel to support eco-friendly manufacturing. Major international automakers have committed to becoming carbon neutral by 2040.
Geographic Coverage
Sweden's green steel market enjoyed the highest market share, primarily owing to aims for climate neutrality by 2045 and accounts for the biggest investment volume that has been announced. Swedish steel venture H2 Green Steel - founded in 2020 - announced that some of the most prominent European financial institutions have decided to support the hydrogen-based steel plant construction in northern Sweden. These investments and funding would increase the supply as many players would establish green steel plants in Europe. Swedish steel companies will ramp up the country's steel production over the next few years as green hydrogen helps drive the transformation of one of the hardest industries to decarbonize.
Top Impacting Factors
Growth Drivers
- Rising Green Penetration
- Carbon Neutrality
- Certificate-based Products
- Multiple End Users
Challenges
- Energy Crisis
- Higher Cost Of Production
Trends
- Increasing Investment In Launching Greenfield Projects
- High Utilization Of Alternative Resources
- New Technologies
Driver: Rising Green Penetration
A green field strategy is a penetration plan designed to broach the untouched or undeveloped areas. Often selling organizations are so focused on well-defined product sales opportunities that they miss the green field altogether. Many companies are following the strategy due to the environment concerns. Green steel is the manufacturing of steel without the use of fossil fuels. Demand for green steel is increasing and technologies continue to be developed as the industry moves towards decarbonization and a more sustainable future. Low-cost and renewable energy sources must be more readily available, however, should the industry wish to achieve its carbon neutral goals. Also, the government of different countries are and will be investing in the green steel market as the supply and demand for green steel is estimated to increase.
Challenge: Energy Crisis
The ongoing European energy crisis has put the domestic steel industry under extreme pressure, driving significant cost inflation and testing the degree to which unprecedented supply discipline can force customers to accept price hikes. Ironically, while currently surging gas and power costs have not impacted all European steelmakers equally, leaving BF-based producers relatively better off, the companies are concerned that decarbonization will meaningfully increase the industry's leverage to power and gas costs. Absent a meaningful correction in prices, this situation could expose the fundamental uncompetitiveness of the industry compared to other regions, in particular the US.
Trend: New Technologies
While certificate-based green products are the focus today, the market is changing rapidly, and today's green products will be followed by a whole new range of options post-2025 as new technologies ramp-up. In Europe, the consensus plan is to develop green hydrogen capacity that will power new direct reduced iron (DRI) plants; green DRI will then be processed into steel in new EAFs powered by renewable energy. The industry's response to the challenges posed by traditional methods is green steel - metal produced without releasing carbon into the environment. There are various technologies being rolled out in pilots around the world, but the focus is on replacing coking coal in the process. Key technologies such as carbon capture, utilization and storage for cement and steel industries and hydrogen-based steel manufacturing are still in prototype and demonstration stages.
Analysis of Key Players
The European green steel market is concentrated with SSAB, Salzgitter and ArcelorMittal as best positioned, in Europe. Key players covered in the report include:
- ArcelorMittal
- GFG Alliance (Liberty Steel Group Holdings UK Ltd)
- H2 Green Steel
- SSAB
- Salzgitter
- Swiss Steel Group
- Tata Steel Europe
- Tenaris
- ThyssenKrupp
- Vanir Green Industries
- Voestalpine
For more information about this report visit https://www.researchandmarkets.com/r/ryzc56
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