Synopsis

Poland's state assets minister, Jacek Sasin, highlighted the significance of maintaining a domestic steel industry in Europe in the wake of the Covid pandemic and the Ukraine conflict. These crises have underscored the dangers of relying on steel imports for essential inputs. Sasin emphasized that Europe must recognize the importance of preserving its steel production capacity, which has declined over recent years. Poland, for instance, faces challenges as it imports significantly more steel than it exports. Investment in low-emission steelworks and energy supply initiatives are vital to secure the region's industrial future, reports Kallanish

Article

During the European Steel Congress held in Katowice, Polish state assets minister Jacek Sasin emphasized the critical role of a robust domestic steel industry in Europe, particularly in light of the Covid-19 pandemic and the ongoing Ukraine conflict. These crises have illuminated the risks associated with depending on imports for essential steel inputs, prompting a reevaluation of the continent's steel production capacity.

In recent years, European steel production capacity has witnessed a decline, making way for other regions to fill the void. This shift has led to occasional steel shortages in the present, necessitating an increase in imports. Poland, for instance, currently imports over 7 million tonnes more steel annually than it exports. Minister Sasin pointed to this trade imbalance as a clear indicator of the challenges Europe faces in maintaining a self-sustaining steel industry.

To address these challenges, Poland is taking proactive steps to revitalize its steel sector. State-owned company Weglokoks is investing a substantial PLN 5 billion ($1.1 billion) in a new steelworks facility located in Ruda Slaska. This investment is expected to breathe "new life" into Poland's steel industry while guiding it toward a low-emission future.

Minister Sasin underscored the indispensable role of steel in various sectors, noting that energy transition, defense enhancement, and construction development all rely heavily on a stable steel supply. He emphasized that Europe's past approach of diminishing industrial presence in the region was misguided, and the current landscape demonstrates the importance of retaining essential industries.

Poland's environment minister, Anna Moskwa, acknowledged that government decision-making processes have posed significant challenges in ensuring an adequate energy supply for industry. Nevertheless, the government is actively implementing measures to enhance domestic industry competitiveness. These efforts include a state support package tailored to energy-intensive industries, which is awaiting approval from the European Commission.

Looking ahead to 2040, Poland anticipates a substantial increase in energy demand, necessitating a shift toward zero-emission energy sources. Initiatives such as the construction of Poland's first offshore wind farm, set to commence this year, and the development of 18GW of offshore energy production by 2040, are pivotal steps in this direction. Additionally, plans are underway to begin construction on the country's first nuclear plant in 2026.

While discussing the European Union's Carbon Border Adjustment Mechanism (CBAM), Minister Moskwa expressed concerns about the rapid reduction of free emissions allowances during the transition phase, which could potentially impact industry negatively. Poland proposed the retention of free allowances during the transition phase as a precautionary measure in case CBAM's effectiveness falls short of expectations.

Conclusion

The Covid-19 pandemic and geopolitical conflicts have brought into focus the critical importance of maintaining a domestic steel industry in Europe. Poland's proactive investments in low-emission steelworks and sustainable energy sources underscore the nation's commitment to ensuring a resilient and self-reliant industrial sector. As Europe grapples with the challenges of energy transition and economic competitiveness, a robust steel industry remains an indispensable pillar for future growth and stability.

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