Japan Increases EV Subsidies to Promote Green Steel Usage

Japan EV

New Incentives to Drive Adoption of Environmentally Friendly Steel

Japan's Ministry of Economy, Trade and Industry (Meti) has announced an increase in electric vehicle (EV) subsidies starting April 1st, aiming to promote the use of green steel. The new measure will provide up to ¥50,000 ($321) in additional financial support, expanding the subsidy to a total of ¥900,000 per EV, depending on the model and size, if it is manufactured with green steel. The initiative is part of Japan's broader green transformation policy to reduce greenhouse gas (GHG) emissions.

Meti has secured a budget of ¥110 billion for the EV subsidy program. The main objective of this increase is not only to boost EV demand but also to support the domestic steel industry. Green steel, though more expensive to produce, has the same functionality as conventionally produced steel, which emits higher GHGs. Meti is addressing concerns among domestic steel producers, who fear the higher production costs of green steel may deter consumers.

Shifting Steel Production to Electric Arc Furnaces

Japan's steel industry is making efforts to reduce GHG emissions, especially through the transition to electric arc furnaces (EAFs). However, EAF plants require significant investment and face various technical challenges. Japan's largest basic oxygen furnace (BOF) producer, Nippon Steel, began commercial operations of an EAF in 2022, and JFE Steel plans to launch its own EAF by 2027. Additionally, Kobe Steel intends to replace one of its BOFs with an EAF facility by 2027.

Despite these advancements, the Japan Iron and Steel Federation (JISF) reported a 3.4% decline in EAF-produced crude steel in 2024, with EAF production accounting for 26.2% of the country’s total crude steel production.

Challenges in Boosting Green Steel Production and EV Sales

Although Meti's measures aim to increase green steel production, there are doubts about their effectiveness, given the sluggish performance of the domestic EV market. Sales of domestic passenger EVs in Japan plummeted by 33% in 2024, largely due to reduced demand for local EV brands. EVs accounted for only 1.5% of total passenger vehicle sales in Japan, down by 0.7 percentage points from the previous year. This decline raises questions about whether the increased subsidies will be enough to stimulate demand for both green steel and EVs.

Atlas completes EVRAZ North America acquisition

EVRAZ

Orion Steel launches as Atlas completes EVRAZ North America acquisition

Atlas completes EVRAZ North America acquisition and forms the Orion Steel Companies. The deal adds EAF and plate capacity across the US and Canada. Former US Steel executive Doug Matthews will lead the new platform.

Capacity footprint and strategic focus

Atlas completes EVRAZ North America acquisition, gaining 2.3mn st/yr steelmaking and 3.5mn st/yr finished capacity. The portfolio spans an EAF mill in Pueblo, a plate mill in Portland, and an EAF in Regina. Pipe facilities across Canada round out downstream exposure and logistics reach.

Atlas prioritizes EAF growth and scrap circularity to lift margins. Meanwhile, Orion Steel can leverage Atlas’ operations playbook for cost, reliability, and safety gains. Scrap sourcing and energy strategy will shape competitiveness against integrated mills.

Market implications for long products and energy pipe

The Pueblo EAF positions Orion Steel to serve rail, rebar, and structural demand. As a result, construction and infrastructure exposure provides a clear demand anchor. Portland plate can target shipbuilding, bridges, and heavy equipment sectors. Canadian pipe assets strengthen exposure to OCTG and line pipe cycles.

Leadership changes support execution as Atlas completes EVRAZ North America acquisition. Doug Matthews brings OEM-level rigor to scheduling, quality, and customer service. Therefore, Orion Steel can pursue multi-year offtake ties with service centers and EPCs.

The Metalnomist Commentary

This carve-out signals renewed private equity interest in North American EAF steel. Watch for capex in melt shops, plate modernization, and pipe finishing. Synergies will hinge on scrap procurement, energy hedging, and rail-served logistics.

China’s Carbon Neutrality Push Expected to Reduce Demand for Raw Materials

China recently unveiled a "Special Action Plan for Carbon Reduction" aimed at enhancing carbon neutrality, energy efficiency, and reducing emissions. This initiative is anticipated to shift the steel industry towards electric arc furnace (EAF) production, thereby decreasing the demand for iron ore and coal.

The plan, announced by the National Development and Reform Commission (NDRC), emphasizes upgrading existing equipment and increasing the use of EAFs to significantly reduce the consumption of raw materials and emissions by 2030.

Although the immediate impact of this policy may be limited, market participants foresee a long-term negative effect on the demand for iron ore and coal. In June, the NDRC outlined specific goals to reduce energy consumption and emissions in the steel industry by the end of 2030. These include reducing per-ton energy consumption for blast furnace and converter processes by more than 1% from 2023 levels by 2025, and reducing energy consumption per ton of steel production by over 2% from 2023 levels, along with increasing the use of waste heat and pressure by at least 3%.

To achieve these objectives, the NDRC and related agencies plan to encourage the increased use of EAFs and accelerate upgrades of energy-intensive equipment. Industry insiders predict that while the visible impact may be minimal in 2024, the long-term demand for iron ore and coking coal will decline.

A representative from a steel company in northern China noted that the short-term impact on coking coal demand might be minor, but the long-term demand is likely to decrease. Similarly, a raw material supplier in Shanxi Province pointed out that the demand for iron ore and coking coal will diminish as EAF production replaces some blast furnace output.

In light of these policies, the proportion of EAF production is expected to rise, and the Chinese government and steel industry are likely to push for increased self-sufficiency in iron ore. According to the China Iron and Steel Association (CISA), Chinese mining companies plan to increase domestic iron ore concentrate production by 5-10 million tons in 2024 compared to 2023. CISA projects that domestic iron ore concentrate production will reach 370 million tons annually by 2025, aided by new iron ore projects.

Mysteel estimates that by 2025, total iron ore production from Chinese companies' overseas holdings will exceed 70 million tons per year, a more than 60% increase from 2020. As a result, with overall iron ore demand declining, iron ore production expansion projects are expected to continue, gradually reducing dependence on iron ore imports from this year onwards.

Japan’s Crude Steel Output Falls for Ninth Straight Month in November

JISF

Japan's crude steel production declined for the ninth consecutive month in November 2023, reflecting persistent weak demand from the construction sector. The country produced 6.9 million tonnes (mn t) of crude steel, a 3.1% year-on-year decrease, according to preliminary data from the Japan Iron and Steel Federation (JISF) released on December 20.

Production via the basic oxygen furnace (BOF) process remained stable at 5.1mn t, while output from electric arc furnaces (EAFs), commonly used for steel products in construction, fell by 11% to 1.8mn t. This marks the second consecutive month of double-digit declines for EAF production, signaling prolonged weakness in the construction industry.

Seasonal and Structural Challenges

The autumn months of October and November typically represent a peak season for Japan’s construction industry as firms push to complete projects before the disruptive winter months. However, rising material costs and labor shortages have dampened sentiment in the sector, further curbing steel demand.

The construction and automotive industries are critical to Japan’s steel market. BOF steel primarily serves the automotive sector, while EAF steel products cater heavily to construction. With construction activity lagging, EAF production has borne the brunt of the downturn.

Producers Adjust Output Forecasts

Japan’s major steel producer, JFE Holdings, revised its crude steel output forecast downward on November 6. The company now expects to produce 22.4mn t for the fiscal year ending March 31, 2025, 600,000 tonnes less than its earlier estimate. JFE attributed this adjustment to weaker-than-expected steel demand from the construction industry.

SSAB Delays Lulea Fossil-Free Steel Mill Project by One Year

SSAB

Electricity Supply Delays Impact Lulea Mini-Mill Timeline

Swedish steelmaker SSAB has postponed the transformation of its Lulea facility into a fossil-free mini-mill by one year. The delay is attributed to setbacks in securing sufficient electricity supply, caused by regional grid upgrade issues. Construction of key substations has been hindered by outage planning problems, leaving the site without the power needed to operate its electric arc furnaces (EAF).

Investment and Production Targets at Risk

SSAB initially approved a €4.5bn investment in January 2022 to build the new mini-mill, replacing its existing blast furnace-based production. The facility will feature two EAFs, a direct strip rolling mill, and a cold rolling line for automotive steels. Once operational, the site is expected to produce 2.5mn t/yr of steel using both recycled scrap and fossil-free sponge iron from the Hybrid demonstration plant in Gallivare. Plans originally targeted 2028 for the first EAF to become operational, reaching full capacity in 2029. However, these milestones are now delayed by one year.

Despite the postponement, SSAB confirmed it will still move forward with EAF installation and maintain its long-term transition strategy. In late 2024, the company secured a €128mn grant from the European Commission to support the transition from coal-based production to a near net-zero emission system, reinforcing its commitment to sustainability despite the temporary setback.

The Metalnomist Commentary

SSAB’s delay underscores the critical role of reliable electricity infrastructure in steel sector decarbonisation. Without timely grid upgrades, even large investments risk losing momentum. The company’s continued push toward fossil-free steel highlights both the opportunities and challenges of Europe’s green industrial transition.

UK scrap export restrictions could cost jobs and billions, BMRA warns

UK scrap

The UK scrap export restrictions debate now carries major economic risk, according to a BMRA-commissioned study. The report finds UK scrap export restrictions would threaten thousands of jobs and curb growth. It argues UK scrap export restrictions would weaken an already strained recycling ecosystem.

EAF transition raises demand for scrap

UK steel is shifting to electric arc furnaces that consume more scrap. If all furnaces used only scrap by 2050, they would need two-thirds of UK supply. UK steelmakers used an estimated 2.6mn t in 2023 amid closures and reduced activity. The UK generates about 10mn t of scrap each year. However, export markets currently sustain prices and liquidity for recyclers.

Policy scenarios show heavy economic losses

The study models multiple restriction options and shows steep losses. A 10% export quota could cut nearly 3,000 jobs and £880mn in five years. A 50% quota could remove over £4bn and 23,000 jobs. A non-OECD ban risks £4.9bn and about 20,000 jobs. BMRA stresses exports are the sector’s “lifeblood” that anchor viable throughput. Meanwhile, government steel strategy consultations continue this year.

The Metalnomist Commentary

Restricting scrap flows to engineer availability risks shrinking the very supply base EAFs need. A smarter path ties domestic EAF ramp-up to price-transparent, open export channels plus quality upgrades. Calibrated incentives beat blunt quotas for long-run circular capacity.

EPCG divests Thyssenkrupp Steel Europe stake as Jindal bid reshapes future

Thyssenkrupp

Thyssenkrupp Steel Europe stake negotiations have shifted sharply as EPCG exits and Jindal emerges as the preferred partner. The Thyssenkrupp Steel Europe stake will now likely anchor a new strategic direction focused on low-emission steel. As a result, the evolving ownership of the Thyssenkrupp Steel Europe stake will influence Europe’s decarbonisation trajectory and regional steel competition.

EPCG steps aside to clear path for Jindal Steel

EPCG agreed to divest its 20pc holding in Thyssenkrupp Steel Europe and withdraw from all joint-venture talks. The investment firm will return its Thyssenkrupp Steel Europe stake and receive full reimbursement of the purchase price. This move reflects Thyssenkrupp’s decision to concentrate negotiations on a single strategic bidder.

Previously, EPCG had planned to lift its stake from 20pc to 50pc and form a 50:50 joint venture. However, the situation changed once Indian producer Jindal Steel submitted an indicative bid for the business. Therefore, Thyssenkrupp is now prioritising a potential deal that couples ownership change with major green-steel investment.

Jindal promises decarbonised steel platform in Europe

Jindal Steel’s bid includes a commitment to complete the DRI project in Duisburg and add new EAF capacity. The group has signalled a financial commitment of more than €2bn to build this low-emission production base. Although the offer remains non-binding, Jindal says it aims to transform the company into Europe’s largest integrated low-emission steelmaker.

This pathway would align Thyssenkrupp Steel Europe with EU decarbonisation policy and future carbon cost pressures. At the same time, Thyssenkrupp is also exploring the sale of its 50pc stake in HKM, further reshaping its steel portfolio. Together, these moves point to a deep restructuring of German steel assets and ownership.

The Metalnomist Commentary

This pivot from EPCG to Jindal underlines how strategic buyers now link ownership with decarbonisation capital. For European steel, the key question is whether promised DRI and EAF investments materialise fast enough to preserve competitiveness. If executed, Jindal’s plan could turn Thyssenkrupp into a flagship low-emission hub, but integration and policy risks remain significant.

Elkem low-CO2 slag recycling accelerates circular materials

Elkem

Elkem low-CO2 slag recycling gained momentum with a NOK 32.8mn grant. The Elkem low-CO2 slag recycling program will convert FeSi slag and secondary silicon into cement alternatives. As a result, Elkem low-CO2 slag recycling targets deep cuts in construction material emissions.

Turning FeSi slag into cement alternatives

Elkem will develop cement alternatives from ferro-silicon slag at its EAF sites. The company targets a CO2 footprint under one-third of standard cement. Testing will run at the Kristiansand facilities acquired in 2024. The materials will serve construction and automotive supply chains. Innovation Norway’s Environmental Technology Scheme funds the project.

Scaling circularity with secondary silicon

Elkem plans recycling rates above 50pc in the new products. The flows will include secondary silicon and FeSi slag fines. Therefore, the project can reduce waste while cutting clinker demand. Lower clinker intensity drives Scope 3 reductions for builders and OEMs. Partners can validate performance during pilot production in southern Norway.

Circular products for resilient supply chains

The initiative aligns with Europe’s low-carbon materials push. It also diversifies binder options for precast and ready-mix users. Meanwhile, cement substitution can ease price volatility tied to carbon costs. Elkem’s silicon expertise and grid access support competitive abatement costs.

The Metalnomist Commentary

Elkem’s move tackles two pain points: slag disposal and cement emissions. Watch durability data, SCM inclusion rates, and scale-up timelines. If pilots confirm strength and workability, demand from EU projects could ramp quickly.

BIR Conference Bangkok Recycling Industry signals Asia’s circular shift

2025 BIR(Bureau of International Recycling)

The BIR(Bureau of International Recycling) Conference Bangkok Recycling Industry gathered global stakeholders across the value chain. The forum covered ferrous, non-ferrous, and specialty metals in depth. The BIR Conference Bangkok Recycling Industry highlighted circular economy execution, not slogans. Therefore, participants focused on infrastructure, technology, and market standards. Meanwhile, BIR’s scale—1.5 million professionals and USD 160 billion—framed the agenda.

The BIR Conference Bangkok Recycling Industry underscored Asia-Pacific’s accelerating demand. Hosting in Bangkok reflected trade gravity tilting toward Asian hubs. As a result, discussions centered on capacity build-out and logistics reliability. Attendees examined traceability, quality assurance, and ESG disclosure. Moreover, members emphasized data for financing and cross-border compliance.

2025 BIR(Bureau of International Recycling)

Ferrous and non-ferrous flows anchor the circular backbone

Ferrous scrap now supplies over 30% of global steel output. EAF adoption increases scrap intensity and resilience. Therefore, ferrous scrap became a strategic raw material. Asia remains the largest import market for ferrous scrap. Korea, Japan, and Taiwan anchor steady tonnage. However, India’s fast-rising demand drew strong attention this year.

Non-ferrous recycling accelerates stainless steel’s circular economy. Over 70% of stainless production uses recycled feedstock today. Consequently, 300-series stainless scrap commands a nickel-driven premium. Copper, aluminum, and zinc recycling rates keep climbing. Meanwhile, EV batteries and e-waste create new metal pools. Processors target dismantling, black-mass recovery, and closed-loop contracts. As a result, service models expand beyond commodity trading.

2025 BIR(Bureau of International Recycling)

Specialty metals scale: Titanium and Nickel Superalloys

Specialty metals advanced from niche to priority. Titanium scrap offsets costly primary sponge and ingot. Proper sorting enables aircraft, reactor, and implant routes. Clean grades often trade at several thousand dollars per ton. Therefore, certification and segregation matter for aerospace and medical uses.

Nickel-based superalloy scrap rose with aerospace growth. Inconel and Hastelloy streams typically exceed 50% nickel. Refiners upgrade these into new superalloy melts. Moreover, chromium, molybdenum, and cobalt increase strategic value. As a result, secure collection and refining capacity became focal. Asia is emerging as the center for scale and skills.

The Metalnomist Commentary

BIR Bangkok confirmed recycling as core supply-chain strategy. Expect capital to target high-purity sorting, verified traceability, and melt capacity. Asian hubs that certify quality fastest will capture premium flows.

Mitsui Invests $5.3 Billion in Rhodes Ridge JV to Secure Long-Term Iron Ore Supply

Mitsui & Co

Japanese Giant Expands Western Australia Offtake Capacity Toward 80 Million Tons Per Year

Japan’s Mitsui & Co. will invest $5.3 billion to acquire a 40% stake in the Rhodes Ridge Joint Venture (RRJV). The move is part of Mitsui’s strategic plan to expand its iron ore offtake capacity in Western Australia to around 80 million tons per year.

The 40% stake will come from existing partners VOC (25%) and AMB (15%). With this acquisition, Mitsui becomes the second-largest stakeholder, following Rio Tinto, which holds 50%. The deal is expected to close by March 31, 2026, according to the company.

The Rhodes Ridge project is set to produce 40 million tons per year in its early stages. Long-term development could increase that to 100 million tons per year. A final investment decision is still pending, but commercial operations could begin as early as 2030.

Mitsui Strengthens Its Role in Global Iron Ore Supply

Initially, Mitsui’s offtake from Rhodes Ridge will be about 16 million tons annually, focused on Asian markets like Japan. Over time, this volume may reach 40 million tons per year, making the project a major contributor to Mitsui’s iron ore portfolio.

Despite the global shift toward decarbonized steelmaking, including electric arc furnace (EAF) adoption, Mitsui believes iron ore will remain vital. The company cited growing crude steel demand, especially in India and Southeast Asia, as key drivers for sustained iron ore consumption.

Broader Investments Support Long-Term Strategy

Mitsui already holds stakes in major Australian iron ore projects, including the Robe River Mining consortium with Rio Tinto and Nippon Steel. The Robe River operation currently supplies Mitsui with 20 million tons per year.

Additionally, joint ventures with BHP account for another 19.9 million tons annually. When combined with the Rhodes Ridge investment, Mitsui's total long-term offtake in Australia will approach 80 million tons per year.

The Rhodes Ridge project has a complex past. Over a decade ago, Western Australia’s Supreme Court required Gina Rinehart to transfer a 25% stake to the Wright family, linked to Peter Wright, a former partner of Lang Hancock of Hancock Prospecting. Since then, Wright’s family, through VOC, has worked alongside Rio Tinto on project development.

This investment highlights Mitsui’s confidence in the long-term fundamentals of the global iron ore market, despite evolving steel production technologies and environmental regulations.