Fastmarkets Unveils EU Green Steel Prices

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by KnowESG
KnowESG_Green Steel
Image courtesy of Freepik

Fastmarkets, a leading price reporting agency (PRA), will launch a new range of green steel prices.

Green steel, also known as sustainable or low-carbon emission steel, refers to environmentally friendly production processes that minimise carbon dioxide (CO2) emissions. Conventional methods, like the blast furnace route, contribute significantly to global greenhouse gas emissions.

The introduction of Fastmarkets' green steel benchmarks aims to provide transparency by comparing prices against traditional flat steel, aiding investment decisions required for emission reduction.

These groundbreaking prices cater to the growing demand for sustainable steel worldwide.

Europe's steel industry is driven to decarbonise by the EU's emissions trading system (ETS) and increasing demand from sectors like automotive.

Steel production accounts for 7-9% of global CO2 emissions, mainly from coal-based blast furnaces. Traditional methods emit around two tonnes or more of CO2 for every tonne of steel produced.

Many steelmakers have planned significant investments to replace blast furnaces with scrap-based electric-arc furnaces (EAFs) and adopt hydrogen-reduced iron plants.

Fastmarkets' green steel differential, ex works Northern Europe, will be assessed weekly against the established Northern European hot rolled coil (HRC) index.

A daily inferred green steel base price will also be calculated in real-time using the Fastmarkets HRC index and the green steel differential.

These green steel prices will reflect the difference between traditional flat-rolled steel and steel produced with a maximum emissions level of 1 tonne CO2 per tonne of steel (including scopes 1, 2 & 3), considering all production methods and raw materials.

Simultaneously, Fastmarkets has been enhancing its price series for high-grade iron ore, metallics, and ferrous scrap.

Andrew Wells, Fastmarkets' global steel and ferro-alloys editor, stated, "Through extensive research and industry discussions, we are well-positioned to bring clarity and transparency to a market that has become a top priority for all steel industry players committed to the energy transition. By 2030, steel with significantly reduced CO2 emissions is expected to account for 30% of the European market."

Raju Daswani, CEO of Fastmarkets, added, "The shift to green steel production is a crucial step towards carbon neutrality and addressing climate change. It aligns with global efforts to reduce greenhouse gas emissions and build a sustainable, low-carbon economy. We are thrilled to collaborate with the industry on its decarbonisation journey and assist in defining, measuring, and communicating green standards and prices to support this transition."

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Source: Fastmarkets

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