Displaying items by tag: Outokumpu
Outokumpu introduces first-of-its-kind initiative bringing customers and steel scrap suppliers together to strengthen circular economy in Europe
Outokumpu is launching a new circularity initiative, Outokumpu Inner Circle, to strengthen the circular economy in Europe. The initiative will be launched today at the World Circular Economy in Helsinki, Finland. The Inner Circle initiative will bring transparency to supply chains and smoothen the path from stainless steel to usable scrap, and from scrap to ever more sustainable stainless steel production – ultimately creating a closed loop for steel scrap. This initiative is the first of its kind for the industry.
“Circularity is one crucial element of sustainable stainless steel production. With the Inner Circle initiative, we are bringing our customers and scrap suppliers together to ensure an efficient, transparent, and sustainable supply chain for steel scrap. Ultimately, our vision is to create a visible closed loop for steel – a unique example of circular economy in action,” explains Max Menzel, Head of Sustainability & Technical Customer Service at Outokumpu.
By using existing, efficient supply chains, the ways for the scrap from customers back to the producers can be shortened. Transparency and ESG conformity throughout the supply chain will be ensured by verifying all partners within this initiative.
In the initiative, Outokumpu’s role is to steer the initiative and create networks between customers and verified scrap suppliers. The scrap suppliers’ role is to ensure a sustainable supply chain by providing scrap from the network’s partners and to distribute the scrap sustainably. Customers who join the program will bring their scrap back into the cycle after processing the material or by the end of the product’s life cycle via the scrap suppliers.
“Together we will show strong initiative and leadership by spearheading the move towards a more circular and a closed-loop economy. Our partners can join this unique and open initiative, which is the first in the industry, and demonstrate their leadership and contribution to the circular economy,” says Max Menzel.
Inviting steel industry partners to join
Outokumpu’s partners can now join this groundbreaking initiative and demonstrate their leadership in circular economy to customers and stakeholders. The first partners will be able to give their input to the creation and development of the network to genuinely add value to the industry’s efforts in sustainability.
“Outokumpu Inner Circle is an open initiative where we would like to welcome all scrap suppliers and stainless steel consumers from Europe to participate. We are now entering the first phase of this initiative and I’m happy to announce CRONIMET as the first scrap supplier partner joining us. At this stage, our focus is on creating the practices and learning about the co-operation. There’s been a lot of interest already, showing that there really is an industry-wide need for this kind of an initiative,” says Max Menzel.
“The Inner Circle initiative builds on the ideas of fairness, openness and the pursuit of long-term partnerships and therefore fits perfectly with our corporate values. At the same time, we are convinced that this is the right approach to achieving sustainability and business success in the circular economy,” says Nico Krueger, Commercial Director at CRONIMET.
Enabling circular economy for a more sustainable future
For Outokumpu, circular economy is at the heart of its sustainability approach. As a material, stainless steel is a key ingredient of circular economy as it is 100% recyclable. Already today, Outokumpu has the highest recycled material content rate in the stainless steel industry at 94%.
“We believe the world does not need more things – but things that last. And when a product is at the end of its life cycle, it should be brought back to life by becoming raw material for something new. The more we use scrap, the lower our emissions are. We would like to enable our customers and partners to actively participate by joining this initiative,” says Juha Erkkilä, VP – Sustainability, Outokumpu.
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs approximately 8,500 professionals in close to 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu has completed the divestment of majority of its Long Products business
On July 12, 2022 Outokumpu announced the divestment of the majority of its Long Products business, and the company has today completed the divestment to Marcegaglia. The prerequisites for the completion of the transaction were, among others, necessary approvals by the competition authorities, and Outokumpu announced these approvals on December 14, 2022. The transaction was carried out as a share sale, and with the transaction, melting, rod and bar operations in Sheffield, UK, bar operations in Richburg, US, and wire rod mill in Fagersta, Sweden were sold to Marcegaglia. The transaction excluded Outokumpu Long Products AB operating in Degerfors and Storfors in Sweden, which continue as a part of Outokumpu.
“I want to thank the personnel in Sheffield, Richburg and Fagersta for our joint journey as part of Outokumpu. It makes us pleased that the new owner, Marcegaglia, is a responsible and committed owner to develop Long Products business even further. As for Outokumpu, we can now fully focus on our core business of stainless steel flat products and ferrochrome according to our strategy,” says Outokumpu’s President and CEO Heikki Malinen.
The total consideration of the transaction on a debt and cash free basis was approximately EUR 228 million, strengthening Outokumpu’s financial position. Cash proceeds for equity and net debt item are approximately EUR 224 million of which EUR 5 million paid to an escrow account. Transaction costs are estimated to be approximately EUR 7 million. The consideration is subject to closing accounts that are finalized during the first half of 2023.
Outokumpu recognized an impairment loss of EUR 35 million in the third quarter 2022 results and does not expect any material gain or loss on the transaction. The cumulative translation adjustment relating to foreign subsidiaries held for sale will be reclassified into profit and loss at the time of disposal and will impact the gain or loss. These impacts will be refined in financial statements release 2022, which will be published on February 9, 2023. Starting from interim report January–September 2022, Outokumpu has classified its Long Products businesses to be divested as assets held for sale and reports the businesses as discontinued operations.
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu is the first stainless steel producer to provide a product-specific carbon footprint based on continuous production data
Outokumpu is committed to help its customers to reduce their climate emissions. As part of its continuous development efforts in sustainability, Outokumpu is the first stainless steel producer to provide a product-specific carbon footprint on its stainless steel products. This will both help customers in their emission-reduction goals and support Outokumpu’s long-term climate targets* and sustainability strategy.
“As the global leader in sustainable stainless steel, we are the frontrunner to push the whole industry forward. At the same time when customers are paying more attention to cutting down emissions, they are asking more specific information about the carbon footprint for each product and solution. We are happy to be the first stainless steel producer to provide the information for products produced in our mills in Europe. Now customers can utilize the data to calculate the product carbon footprints of their products and provide more sustainable solutions to the market”, says Stefan Erdmann, Chief Technology Officer & Group Sustainability at Outokumpu.
The distinct feature of the calculation model Outokumpu is using is based on continuous follow-up of production data.
“In addition to customer value, the product-specific carbon footprint brings full transparency to the sustainability work Outokumpu is executing”, Erdmann continues.
Transport industry shows an example of urgent need for emission-reduction actions
One of the industries benefiting from product-specific carbon footprint is transport. Transport accounts for 21% of global carbon emissions and the emissions from the transport sector are expected to grow by 20% by 2050**. Biofuels and electric vehicle solutions are already in use to cut emissions from heavy road traffic, but we need to use other solutions too. The reduction of emissions from a new vehicle is also affected by, for example, the steel material used in the manufacture of the vehicle and its carbon footprint.
“Road transportation, especially buses and coaches, is an area where stainless steel can have a very significant impact in helping to achieve carbon neutral mobility. Companies in the industry have ambitious climate targets and the end-customers’ demands, as well as requirements coming from all major Original Equipment Manufacturers, guide the climate work forward. With this new feature, it is also interesting to see how the customers would now be able to design CO2-emission optimized products for the upcoming application generations – for example next-generation vehicles”, says Markus Buckner, Head of Mobility & Transport at Outokumpu.
“Today, many companies are calculating and reporting direct and indirect emissions, but there is a growing need to reduce all other indirect emissions from a company’s value chain. To calculate the complete CO2 emissions down the supply chain it is essential to know the CO2 impact of the pre-material – and that’s why the product-specific information is needed. Outokumpu is in a great position to support the steel industry with the knowledge of being the only stainless steel producer to report emissions from all three scopes and to have the leading role in using recycled material for over 90% globally”, Buckner continues.
*) Outokumpu’s climate target is to reduce carbon dioxide emissions by 42% by 2030 from the base year of 2016. This translates to an emission reduction of 14% by the end of 2025 from the 2021 levels, in accordance with the Science-Based Targets initiative’s 1.5 climate target. Outokumpu is the only producer of stainless steel with a climate target approved by the initiative.
**) https://www.weforum.org/agenda/2021/11/global-transport-carbon-emissions-decarbonise/
For more information:
Product carbon footprint | Outokumpu
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu aims to improve its energy efficiency significantly in 2023 and 2024 amidst the European energy crisis
Outokumpu has decided to significantly increase its energy efficiency improvement target and prioritize related investments in 2023 and 2024.
So far, Outokumpu’s target has been to improve energy efficiency by 0.5% annually. Until the end of 2024, Outokumpu now aims to improve its energy efficiency by 8% across the group compared to the January–September 2022 level. These measures would correspond to energy saving of approximately 600,000 MWh which is equal to annual electricity usage of 15,000 households.*
“The European energy crisis has created a turbulent operating environment. To tackle the uncertainty, we have decided to take immediate action on our own energy efficiency. This means that we will prioritize investments to improve our energy efficiency and also increase related annual capital expenditure by EUR 20 million in 2023 and 2024”, says Outokumpu’s Chief Technology Officer Stefan Erdmann.
These additional investments do not impact Outokumpu’s capital expenditure frame of EUR 600 million for the second phase of the strategy by the end of 2025. For 2023 and 2024, the annual capital expenditure remains EUR 200 million.
Outokumpu’s target is to reduce its carbon dioxide emissions by 42% by 2030 compared to 2016 baseline. “The new efficiency measures will support Outokumpu to achieve our ambitious climate targets”, continues Erdmann.
*) MWh per ton of stainless steel. Energy savings calculated by average electricity use of 20,000 kilowatt hours by a family of four living in a detached, electrically heated house.
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu completed the change negotiations related to the restriction of the ferrochrome production
Outokumpu has completed its change negotiations related to the company's plans to further restrict the ferrochrome production and to delay the restart of one ferrochrome furnace after a maintenance break at least until the end of the first quarter of 2023.
At the start of the negotiations, Outokumpu announced that the planned measures would concern at most 70 people. The aim in the change negotiations was to find a solution where Outokumpu would be able to employ the ferrochrome personnel in the other Tornio operations.
As a result of the negotiations, the fixed-term measures will affect 52 people for whom the aim is to find work in the other Tornio operations.
“The further delay of the restarting of the furnace is a difficult but necessary measure in an utterly exceptional situation. The price of electricity remains exceptionally high, and the high price continues to have a negative impact on our cost competitiveness compared to the competitors, mainly from outside Europe. The change negotiations were conducted in good cooperation, thank you to all parties involved in the process,” says Martti Sassi, President, business area Ferrochrome.
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu plans a significant investment in a biocoke and biomethane plant, aims at reducing climate emissions and increasing self-sufficiency in energy in Finland
As a part of its ambitious climate actions, Outokumpu is planning an investment in a biocoke and biomethane plant at its stainless-steel production site in Tornio, Finland. This large-scale biocoke project has now proceeded to a phase where Outokumpu is applying for investment support totalling EUR 25 million. If realized, this project would significantly increase self-sufficiency in energy in Finland, and it also has the potential to reduce carbon dioxide emissions by more than 200,000 tonnes per year. This project supports significantly the Finnish and European energy and climate targets for 2030.
“As the global leader in sustainable stainless steel, we actively look for new ways to reduce climate emissions. The new biocoke and biomethane plant would show that it is possible to produce a new raw material from the forest industry waste that is currently burned for low-efficient energy creation purposes. The new raw material, which is called biocoke, could replace the coke that we currently import and that is used as reductant in Outokumpu’s ferrochrome production process. The usage of the forest waste instead of solid wood, like other manufacturers, and the ability to produce a significant amount of biomethane in that process is showing the innovative capabilities of Outokumpu. The production of biomethane is enabling Outokumpu to become more independent of external fossil fuel sources,” says Juha Erkkilä, Outokumpu’s Head of Sustainability.
Outokumpu’s climate target is to reduce carbon dioxide emissions by 42% by 2030 from the base year of 2016. This translates to an emission reduction of 14% by the end of 2025 from the 2021 levels, in accordance with the Science-Based Targets initiative’s 1.5 climate target. Outokumpu is the only producer of stainless steel with a climate target approved by the initiative.
“Using biomass-based raw material and biofuels produced from bio-wastes will significantly reduce carbon dioxide emissions and strengthen the execution of Outokumpu’s sustainability strategy. If realized, the project would strengthen the independence of Outokumpu from fossil fuels and create new job opportunities in the Tornio region. Our target is to make the investment decision in 2023, if the application for investment support is approved. Outokumpu has already started the environmental impact assessment for the project, and the first hearings have been carried out,” continues Erkkilä.
Outokumpu’s biocoke project is a result of the research done in the Towards Carbon Neutral Metals (or TOCANEM) program*, financed by Business Finland. The biocoke project would, if realized, be one of the first new significant industrial investments to reduce carbon dioxide emissions as a result of the TOCANEM program. In the TOCANEM research program, the metal industry and research organizations have together researched possibilities to reduce carbon dioxide emissions in the production of steel and other metals.
Outokumpu will delay the restart of one of its ferrochrome furnaces
Outokumpu will delay the restart of one of its ferrochrome furnaces after a maintenance break due to the elevated electricity price – stainless steel deliveries to remain on a normal level
Due to exceptionally high energy prices and an unstable energy market, stainless steel producer Outokumpu has decided to delay the restart of one of its three ferrochrome furnaces after a planned maintenance break. The maintenance break starts on September 7 and a restart was initially planned for week 40. Ferrochrome production will continue at about 70 per cent of its full capacity.
“Energy prices have increased significantly, which has had a negative impact on our cost competitiveness compared to our non-European competitors. We hope that decisive actions are taken at both EU and national level to stabilize the energy market. We are keeping a close eye on the situation and hope that politicians will take an active role in normalizing the operating environment,” says Martti Sassi, President, business area Ferrochrome.
“We have already been optimizing our ferrochrome production by not producing ferrochrome at the highest hourly prices to avoid the worst peaks in prices, as communicated earlier*. The decision to delay the reopening of one of our furnaces is a continuation of the ferrochrome production optimization,” Sassi continues.
In Finland, the Olkiluoto 3 nuclear power plant plays an important role in stabilizing the electricity market, and it is vitally important to get it up and running during this year for a healthier energy market. On a European level, Outokumpu uses 4 TWh of electricity, which is close to the entire electricity consumption of Helsinki, the capital of Finland.
Stainless steel deliveries on a normal level in the third quarter
Despite the decrease in Outokumpu’s ferrochrome production, the company’s stainless steel production will remain on the same level as guided in our January–June interim report, and these measures will not impact our customer deliveries or financial outlook for the third quarter. We will comment on our outlook for the fourth quarter in connection with Q3 results on November 3.
Ferrochrome is an alloy between chromium and iron and is an essential raw material in the production of stainless steel. Ferrochrome production uses more than 50 per cent of Outokumpu’s total electricity consumption in Finland.
*) Pia Aaltonen-Forsell, blog 31.8.2022: Energy crisis in Europe – how the rising electricity price impacts Outokumpu, https://www.outokumpu.com/news/2022/blog-energy-crisis-in-europe---how-the-rising-electricity-price-impacts-outokumpu
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu sets the new standard for the world’s most sustainable stainless steel – launching a product with 92% lower carbon footprint than the industry average*
Outokumpu is shaping the stainless steel market with its new emission-minimized product line, Circle Green. It has the smallest emission intensity in the world, with a 92% lower carbon footprint than the global average and 64% lower than Outokumpu’s regular production – which is already the current sustainability leader in the industry. The new standard for sustainable stainless steel is now set.
“We are extremely proud to introduce a new product line, Outokumpu Circle Green, which is truly an innovation in the stainless steel industry and a result of our focused learning journey. The first batch was produced in Tornio, Finland, and was delivered to one of our strategic customers, Fiskars Group, to use for cookware. I’m extremely proud that we have launched a product that has a true impact on our customers’ climate ambitions,” says Niklas Wass, Executive Vice President, Operations, at Outokumpu.
“We see increasing global customer demand for low carbon footprint stainless steels, from construction to heavy industry and consumer products. I’m very happy to say that Outokumpu is now ready to answer this demand. In this first phase, we will concentrate our efforts to serve a few strategic customers, but we are already looking at ways to scale up the production,” Wass says.
Bio-based materials used together in the production
Outokumpu achieved the unprecedented emission reduction with improvements throughout the whole stainless steel production chain. Reductions in upstream raw material emissions were key to this success as they contribute the majority of stainless steel’s total carbon footprint. Meticulous production and quality optimization led to higher energy efficiency. Biogas, biodiesel, bio coke, and low-carbon electricity have been used in production to eliminate 95% of all scope 1 and 2 CO2 emissions. While these bio-based materials have all been tested previously in production, they were used together for the first time ever to produce Outokumpu Circle Green.
“Our emission-minimized product answers the global need for more sustainable and long-lasting products that help to build a more sustainable future. The material was produced on an industrial scale with our existing production assets. This is a key step and an essential achievement towards meeting Outokumpu’s sustainability goals,” Wass says.
A global first with emission-minimized stainless steel production
The production of the new Outokumpu Circle Green is the first of its kind, as no other stainless steel manufacturer has been able to produce stainless steel with such low emission levels when taking into account all the climate emissions through the whole production chain including scope 1, 2 and 3. Climate compensating or offsetting has not been used in calculating the emissions and the focus has been on improving Outokumpu’s own processes and supply chain.
Outokumpu reviewed and optimized the emissions from each production step from the stainless steel melt process and energy production to transportation and raw material production. The emission reduction calculation includes all emission scopes according to the Greenhouse Gas Protocol method to give the full picture of the emissions.
Outokumpu is leading the global stainless steel industry in emissions reduction and carbon neutrality – the global work towards the Paris Agreement goals requires quick actions. Outokumpu is the only stainless steel producer to have its climate targets approved by the Science Based Targets initiative (SBTi).
“I would like to thank our Outokumpu team for making this possible. Our experts have been extremely committed to the historic project and the team spirit has been really high as we have been building a new step to a sustainable future. We will keep working towards a world that lasts forever,” Wass says.
*Source: ISSF calculation for stainless steel industry mean emissions
Outokumpu launches emission-minimized stainless steel
Outokumpu has limited exposure to Russia and Ukraine
Outokumpu has been closely following the developments in Ukraine, and the company regrets to see that the conflict has now been escalated into war after Russia’s military attack. Outokumpu does not have employees or subsidiaries in neither of the countries.
In the short term, Outokumpu does not expect any material impacts from the situation on its business and operations.
If the situation continues, it could impact Outokumpu’s procurement of raw materials and energy gases.
- Outokumpu’s main raw material is recycled steel which accounts for more than 90% of production. There is no dependency on Russia or Ukraine in recycled steel and only a limited amount of total nickel requirements is currently sourced from Russia. Supplies of additional raw materials have only a limited exposure to Russian origin materials and mitigation actions are already in place to resource such materials.
- Outokumpu acquires energy gases in the European market, Russia being one of the indirect supplier countries. Alternative sources are being tested.
- Our ferrochrome sources are independent, as we have our own chrome mine and ferrochrome production in Finland.
Outokumpu has an indirect stake in the Fennovoima nuclear plant project in Finland driven by Russian-owned company Rosatom. Outokumpu stated in its financial statements release that the fair value of the Fennovoima project was decreased to zero due to increased project risk.
In case of any direct and material financial impact, Outokumpu will announce them without delay.
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs some 9,000 professionals in more than 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
Outokumpu receives the highest Platinum level sustainability recognition from EcoVadis
Outokumpu has received the highest Platinum level recognition for the second year in a row from the sustainability rating platform EcoVadis. The Platinum level rating indicates that Outokumpu is among the top 1% of the over 85,000 companies evaluated.
“We are happy to continue on the highest Platinum level in the EcoVadis rating and to be among the top 1% sustainability performers. We have made good progress in sustainability and launched our more ambitious sustainability strategy and targets last year. We are pleased to see that our total score in the assessment increased from last year reflecting our strong commitment to sustainability. We aim to continue improving our scores even further and strengthen our position as the industry leader in sustainability”, says Juha Erkkilä, Vice President, Group Sustainability at Outokumpu.
EcoVadis assesses companies in respect to environment, labor and human rights, ethics and sustainable procurement. EcoVadis assesses companies in line with global standards such as GRI and UN Global Compact. As a part of its sustainable sourcing initiative, Outokumpu partnered with EcoVadis in 2021 to evaluate the sustainability performance of its raw material suppliers.
Outokumpu has recently improved its performance in other ESG ratings as well. In February 2022, Outokumpu was included in the S&P Global’s Sustainability Yearbook and in the latest Carbon Disclosure Project's (CDP) assessment in 2021, Outokumpu received the second highest B rating for its climate action and upgraded to grade C in CDP’s water assessment. Outokumpu has improved its ratings also in MSCI and Sustainalytics ESG ratings.
“At the same time, when we have put in place a more ambitious sustainability agenda and improved our ESG ratings, we see increasing need for more robust processes especially in assessing our own supply chain. This will be one of our key focus areas in 2022”, says Juha Erkkilä.
As the leader in sustainable stainless steel production, sustainability is at the core of Outokumpu. Outokumpu updated its sustainability strategy and climate targets in 2021 committing to the Business Ambition for limiting global warming to 1.5°C.