Acciaierie d'Italia (ADI) has begun phasing out hot production at its steel plant in Taranto after a Milan court rejected the company's appeal against an earlier closure order. The decision has increased uncertainty around the future of steel production at the company and its impact on the European flat rolled products market.
The stop started on September 16. On September 11, the Milan Court of Appeal rejected ADI's appeal against a previous order regarding the closure of the hot cycle section of the former Ilva plant. The court has decided to suspend the work of the entire hot redevelopment of the company until October 28. In particular, coking chemical production and blast furnace No. 2 with a capacity of about 2 million tons per year, the only one of the five operating blast furnaces, were subject to restrictions.
The ADI press service declined to comment in detail on the situation, limiting itself to a promise to give an assessment later, after contacting S&P Global Energy.
Court proceedings
The Special Commissioners who manage ADI in the emergency administration mode have filed a new appeal. The Italian Court of Cassation, the country's highest court, has scheduled a hearing for October 20 to consider a complaint against the Milan Court of Appeal's decision to close, the unions said after a meeting with the government on September 16.
Sources close to ADI confirmed this information, but it is not yet known when exactly the Court of Cassation will make a decision on the results of the hearings.
The Taranto plant has a nominal capacity of about 8 million tons of crude steel per year. Production is carried out from iron ore and coal in blast furnaces, which makes the company the largest steel mill in Italy and one of the most important integrated metallurgical complexes in Southern Europe. Long-term legal and production problems have long had a negative impact on the country's steel output.
ADI believes that stopping the hot conversion could jeopardize the entire steel production in Italy, as the company's northern facilities recycle the roll produced in Taranto. Against this background, the Italian government, which is looking for a buyer for the company under emergency management, is under increasing pressure to propose an alternative industrial solution before national elections next year.
The former assets of Ilva were placed under emergency management on February 20, 2024, when special commissioners were appointed at the request of the Government. The decision was made with the participation of the state investment agency Invitalia, despite the objections of ArcelorMittal, which was then the largest shareholder of ADI.
The Taranto plant has long been at the center of public health controversies.,