Synopsis
Liberty Steel aims to sell iron ore stored in Constanta port, Romania, initially meant for its local blast furnace. The furnace's continued idleness and other operational disruptions indicate that the company may not restart it. This move has raised questions about Liberty Steel's future strategies and stability.
Article
Liberty Steel has been facing a series of disruptions lately, not least of which is the idling of its sole operational blast furnace in Romania. The furnace, which was supposed to resume operations on October 24, remains inactive due to poor weather conditions in the Black Sea and low water levels in the Danube.
Market watchers have noticed that Liberty Steel's decision to sell iron ore could be an indication that the Romanian blast furnace might not return to service. Adding to these concerns, the company has also been importing slab via traders and has recently sold some carbon credits.
Liberty Steel's troubles are not confined to Romania. The firm's Ostrava blast furnace is also offline due to weak demand. It even shut down its largest coke oven at the site, reasoning that purchasing merchant materials would be more cost-effective. Liberty is also said to be behind on payments to its power suppliers.
Several sources have confirmed that Liberty is keen to offload iron ore from Constanta port. The exact amount remains undisclosed, but one source suggested it could be as much as 160,000 metric tons. This ore supply comes via a third-party trader, further complicating the situation.
The iron ore prices are relatively high at the moment, standing at $123.60 per metric ton according to Argus' 62pc Fe ICX index. However, spot buyers are few, and most European steel producers are operating at low capacity due to weak demand.
Liberty has been supplying Dunaferr with slab from its Galati unit in Hungary. But even there, everything except the coke ovens has been idled, further indicating a problematic operational landscape for the company.
Conclusion
Liberty Steel's decision to sell iron ore from Romania opens a can of worms about its operational efficiency and future plans. The extended idleness of its blast furnaces in multiple locations paints a concerning picture for stakeholders. As the company maneuvers through these disruptions, its actions could set the tone for its future in a highly competitive market.
