Germany’s “steel summit” to clarify way forward for struggling industry

Germany’s upcoming “steel summit” is meant to provide clarity and consensus on steps needed to strengthen the struggling industry, a government spokesperson has said ahead of the meeting scheduled for 6 November. Members of the government coalition are set to meet steel industry representatives to discuss how to strengthen the competitiveness of steelmaking in Germany and Europe, which faces stiff competition from China, high import tariffs from the US as well as the costs of transitioning to climate-friendly production.

“Some things can be decided here in Germany, while others must be decided at the European level. That is why it is all the more important to speak with one voice there, too,” the spokesperson said.

Germany’s government is exploring options to support the steel industry, such as lowering energy prices and introducing an industrial electricity price. Negotiations with the EU on the latter are in the final stages, economy minister Katherina Reiche said earlier this week.

Hendrik Wüst, state premier North Rhine-Westphalia, a stronghold of Germany's steel industry, also called for extending free EU emissions certificates beyond the planned deadline, newspaper Rheinische Post reported. A planned reform of the EU emissions trading system (ETS) - which puts an annual cap on how much CO2 industry can emit – would see the gradual phase-out of free allowances from 2026 and end them for all industries by 2034, with no new allowances issued by around 2039. Industry representatives have urged the EU to reconsider this.

Meanwhile, the Social Democrat (SPD) parliamentary group, the junior partner in the governing coalition from Friedrich Merz’s Christian Democrat’s (CDU), called for an aid package to protect Germany’s domestic steel industry, newspaper Handelsblatt reported. “The industrial electricity price, a future-proof power plant strategy and the capping of grid fees are long overdue,” said Dirk Wiese of the SPD parliamentary group. “These measures are crucial to ensuring that our industry remains internationally competitive and jobs are secured.”

Germany’s ambitions to decarbonise steelmaking and use green hydrogen to help clean up industry more broadly suffered a recent blow when steelmaker ArcelorMittal dropped plans to convert two plants to climate-friendly production. Preserving a domestic steel sector is in Germany’s “strategic interest”, noted chancellor Merz earlier this year.