From the blast furnaces of Taranto to the furnaces of Piombino: this is how the steel industry is coming to an end

Taranto. Since taking office, the Meloni government has stated that it wanted to turn Ilva into Europe’s largest green steelworks – that is, one without blast furnaces. Whilst Germany has reignited two blast furnaces in recent months, yesterday Italy permanently shut down its last three remaining operational blast furnaces in Taranto. Yet Germany produces only 30 per cent ‘decarbonised’ steel, compared with Italy’s 90 per cent – a figure that, as of yesterday, has risen to 100 per cent. A success for environmentalists, but far less so for the country’s industry.

However, Italy, with more than 20 million tonnes of steel, remains Europe’s second-largest producer, and annual output has increased (albeit less than in Germany), even though it now imports flat-rolled products. The billet steel that used to be produced in Taranto and rolled in Genoa. For years we were told that this would be a problem for Italy, confining the environmental issue to Taranto. Unlike in Germany, however, the issue here is not CO₂ but particulate emissions—those that are harmful to health. The problem with Ilva has always been its proximity to the city, a serious error on the part of the local authorities who allowed a pre-existing neighbourhood to expand until it became one with the chimneys and mining sites.

The capping of mining sites and the installation of new filters came when relations with the local population had already been compromised, and neither politicians nor trade unions had the courage to rectify the situation. The famous decarbonisation plan, involving the construction of electric furnaces, has been under discussion for ten years. Yet no one has gotten it off the ground. It would have been industrially and economically viable at the time, with the construction of new plants accompanying the gradual phasing out of blast furnaces, as is happening in Germany. But the trade unions were opposed because it would have halved employment, and industrialists because it would have reduced the supply of scrap on the market. And replacing it with pre-reduced steel to be produced in Italy became an economically unviable undertaking. In the meantime, however, the blast furnaces have been phased out.

While ArcelorMittal may be accused (though this remains to be proven) of having deliberately sought to destroy the plants, the special commissioners appointed by Minister Adolfo Urso did so through incompetence. This is state-owned steel. One blast furnace shut down due to a fire in a tuyere, another running out of ore, and yet another with asbestos – these are management errors, not matters of justice.

The tender process for the sale of Ilva closes tomorrow. As things stand, the only remaining bidder is the Indian firm Jindal, which would use the site to roll raw materials sourced from India. The shutdown of the hot rolling mill at the former Ilva site will not leave Italy without steel. The market has already reorganised itself. Whilst Taranto’s production fell from 8 million tonnes to less than 2 million tonnes, flat steel products began arriving from Arvedi, Belgium, the Netherlands, Austria and, in increasing quantities, from China and India. Just as we depend on China for rare earth elements, on Arab countries for oil, and in the past on Russia for gas, we will do so for steel. It is a question of national sovereignty, as this government likes to say, and of strategic autonomy, as is fashionable to say in Europe – and not merely a market issue.

The National Steel Industry Plan, often mentioned by Minister Urso, has never materialised. In Piombino, the Indian firm JSW was due to build an electric furnace from 2018. The project has now passed to the Ukrainian firm Metinvest, which yesterday announced it was seeking new investors to take its place. Nothing will come of it in Tuscany either. There, too, 700 employees are on short-time working. In Taranto, Acciaierie d’Italia employed around 10,000 workers to produce two million tonnes – the same workforce as in the days when output stood at eight million tonnes. All this came with the impossible promise that, sooner or later, they would all return to the factory. Whilst the market has adapted, the workers and politicians have not. Just like in the Soviet Union: five-year steel plans were implemented by decree, more to satisfy the wishes of the Party’s Central Committee than to meet actual demand. But reality, in the end, always prevails.