European steel industry attracts new investments
Although Europe's steel industry continues to suffer from declining demand and high energy prices, recent policy measures have made the region more attractive for investment, panelists at the Kallanish Europe Steel Markets 2026 conference in Vienna said.
Stanislav Zinchenko, Executive Director of GMK Center, noted that metallurgists have a unique opportunity to use the growing profitability to modernize and decarbonize assets. According to his estimates, the profitability of the industry could double by 2027 compared to the level of 2025. Higher profitability can make the resumption of production and new investments more attractive.
However, new investments can lead to an imbalance in supply. Zinchenko spoke about the potential additional capacities for the production of flat rolled products in the amount of about 14 million tons per year, which can be created from scratch. "What will Europe do with all these new capacities?" He asked.
Banks provide financing, but it is difficult for the steel sector to compete with "more attractive" sectors such as artificial intelligence, said Matthias Winkeler, director of ING Bank.
He noted that political support is becoming increasingly important to secure funding. The more confidence there is in protective measures such as the Carbon Dioxide Emissions Control Mechanism (CBAM), the more confident banks are that steel companies will be able to repay their loans.
There are opportunities for specific investments in certain products. The Polish factory in Czestochowa Huta has been revived by Weglokoks thanks to investments from the Polish Ministry of Defense, said Adrian Sinicki, Vice President of Weglokoks.
The company saw a special opportunity in the production of rolled products and restored the bankrupt plant. Although the defense industry is a key target sector, it is expected to account for only 7% of sales and a maximum of 12% of profits.
Another 10% of the volume will be accounted for by the energy sector, while the construction and infrastructure industries will become the largest consumers.
Luciana Filizzola, Director of Sustainability and Communications at GMH Gruppe, noted that investments in specific products were crucial. GMH has acquired two companies that are currently combining to produce foundry and tool steel. This high-tech steel production means that the company can export products to China, she noted.
However, she warned that one of the key risks for the European steel industry is too high energy prices. This means that