26.04.2021. SSAB’s earnings improved sharply during the first quarter of 2021. Demand is strong, prices are increasing and we have taken strategic steps in their transition to a fossil-free steel production. The recovery that started during autumn last year has strengthened during the first quarter. SSAB’s production level has been stable and together with better prices and higher shipments, the result increased by SEK 1.4 billion compared to the fourth quarter of 2020. Operating profit for the first quarter amounted to SEK 1,993 (343) million.
Strong demand for high-strength steel
There is strong demand for high-strength steel and SSAB Special Steels maintained a high, stable production rate. Shipments reached a record high SEK 376 (305) thousand t and operating profit increased to a record level of SEK 904 (458) million in the first quarter of 2021. The operating margin increased to 18 % (10 %).
SSAB Europe’s result increased to SEK 758 (0) million. Strong demand has resulted in higher shipments and better prices. SSAB America’s result also increased, to SEK 268 (106) million. Better margins contributed positively, whereas shipments were affected by weather-related issues in North America as well as low opening balance of slab inventories.
Measures to limit the spread of Covid-19 continue and production has run without any major impact. Market conditions are favourable and they expect good activity during the second quarter of 2021.
Goal to be fossil free by latest 2045
SSAB is leading the green transition in the steel industry and the goal is to be fossil free by latest 2045. They have taken additional steps during the quarter to be world-first with fossil-free steel. Fossil-free steel will not only reduce their own emissions, they can also help customers to reduce their climate impact, while strengthening their competitiveness. In April, SSAB entered into a strategic collaboration with AB Volvo on the world’s first vehicles to be made of fossil-free steel with shipments for concept vehicles already this year. The great interest in fossil-free steel shown by customers, means that SSAB is exploring how to convert to fossil-free production in Luleå faster than currently planned. The conversion of Oxelösund proceeds according to plan and investments have started.
Hybrit: world’s first demonstration plant for fossil-free sponge iron
Together with their partners, LKAB and Vattenfall, SSAB will create something unique for our customers – the most efficient fossil-free value chain in the world. The three companies have together decided that the industrialisation of Hybrit will begin in Gällivare, with the world’s first demonstration plant for fossil-free sponge iron, the feedstock for fossil-free steel. The plant is scheduled for completion in 2026 and capacity will amount to 1.3 million t of fossil-free sponge iron. They are also starting the construction of a hydrogen storage facility outside Luleå to develop the storage technology. Storage will play an important role for future power and energy balancing by, for example, using stored hydrogen gas when the electricity system is under strain. SSAB’s transition is progressing at the highest pace possible and they are convinced that they can further strengthen this leading position.