Tata Steel to announce UK energy surcharge

Steelmaker Tata Steel will implement an energy surcharge linked to power and gas prices, the mill told UK customers.

The value of the surcharge is not yet clear, as the mill is still deciding on it. The cost increase for blast furnace producers is much lower than for electric arc furnace-based mills, with some saying it is around £30-40/t in the UK.

UK-based Liberty Steel, which provisionally planned to announce a £120/t surcharge earlier this week, has decided not to implement any surcharge, after a meeting between its different mills today.

Tata is still deciding which contracts the surcharge will apply to, the buyers said. Energy costs are substantially higher in the UK than in the EU, and no flat mill has announced a surcharge on the continent yet, although some leading producers are reportedly studying the idea.

Argus' weekly UK hot-rolled coil assessment was £860/t last week.

By Colin Richardson