During the Made In Steel 2025 fair held recently at Rho Fiera Milano, SteelOrbis had the opportunity to interview Giuseppe Pasini, president of Feralpi Group and Confindustria Lombardia. Among the topics Pasini discussed with SteelOrbis were decarbonization and green issues, but also criticisms related to markets and production costs, as well as the procurement of strategic raw materials such as scrap.
I would like to start by asking how the fair is going so far.
The fair is going well, it is always nice to come together, even at a time when the global geopolitical situation is not ideal. Having said that, Made in Steel remains a not-to-be-missed opportunity for discussion with other market players.
I don't know if you followed the event’s inaugural speech. What did you think of it?
Yes, I was there, and, frankly, I agree with the statement that the steel supply chain must deal with many difficulties that not only concern production, costs, etc., but also with an excess of bureaucracy when it comes to the discussion with institutions or other entities. On the other hand, I do not agree with the statement that scrap consumption in Europe each year is 20 percent lower than the actual availability of this resource on the territory. It's not like that. Traditionally, European scrap has always followed routes that go from northern Europe to Turkey and India. These are stable and well-established paths, but if the European Union does not intervene, the situation could change, and it is already changing. Scrap is an increasingly strategic resource for the transition to electric arc furnace production.
Speaking of electric arc furnace production, I know that you are about to launch a new rolling mill at your plant in Germany.
Yes, it was the result of numerous investments that Feralpi wanted to carry out in Germany, and not only there. I can say that we have succeeded, and we are proud of this new goal.
(The new Feralpi Stahl rolling mill, scheduled to be inaugurated on May 15 at the Riesa plant in Saxony, will be the first rolling mill in Germany dedicated to the production of spoolers and the first in the world capable of producing coils up to 8 mt. In addition, it is a state-of-the-art plant with zero direct emissions, which is part of Feralpi Group's ESG strategy together with FERGreen, already mentioned by SteelOrbis.)
How do you view the German market so far?
The situation seems slightly livelier compared to the third quarter of 2024. It seems that, as new chancellor, Mertz is giving some signs of hope to the industrial sector, but it is still too early to know how things will go. Considering that he didn’t have the approval of his majority in the first place, one might think that this new coalition is rather fragile. We'll see.
What about Poland?
Business is going very well in Poland, I would say. We sold a lot last year.
What can you tell us about the situation in the local market in Italy?
Most of our investments in Italy are in the infrastructure sector, where demand and consumption are at acceptable levels. We have seen a slight decline in the construction sector after the Superbonus boom in past years, but thanks to the boost from the PNRR [National Recovery and Resilience Plan] funds, I must say that infrastructures are doing well.
On the cost side, how do you think the critical issues related to scrap and electricity will evolve?
First of all, we need to stress two aspects. The first one is that the cost of scrap in Italy is much higher than in northern Europe, and the second is that electricity costs in Italy are 40 percent higher than the EU average and 70 percent higher than in France, which is the EU country with the lowest cost of electricity.
These two critical issues must be overcome, and the way to do this, in my opinion, is to invest more in renewables, such as wind and solar, and to make access to the use of these energy resources less bureaucratic. Moreover, there is the topic of nuclear power. It is still too early to talk about it, but it is there, and it is an issue. In my opinion, it would not be bad to be able to count on 15-20 percent of energy coming from nuclear sources.
Finally, I honestly notice a bit of resistance from the Italian regions when it comes to moving from theory to practice. In theory, everyone fills their mouths with words such as green, decarbonization, renewables, etc., but when it comes to taking serious steps towards projects of this type, the commitment always seems to be weak. And it does not seem to me that Europe is making much effort to implement measures towards cleaner energy production.