Beleaguered Hungarian steelmaker Dunaferr continues to produce at limited capacity as the bidding process between GFG Alliance and Jindal-affiliated Vulcan Steel plays out.
The rolling lines are currently idled and are expected to restart on 11 July, according to trade union sources and others close to the company. The rolling mill has a capacity of 2mn t/yr, and the steel mill is currently producing just a fifth of this.
Earlier this year, Liberty moved raw materials from its Galati site in Romania to the Hungarian plant, after the previous management said coking operations would have to be stopped. It has had a tolling contract for the assets since, but is reluctant to invest more money until it is clear who will take on the assets, sources suggest. A GFG spokesperson declined comment.
Mauritanian entity Vulcan and UK-based GFG were the only bidders for Dunaferr to be shortlisted, with Metinvest, Trasteel and Trinec Property not moving forward. Trader Steel Mont is representing Jindal Steel & Power sister company Vulcan in its bid. The deadline for bidding is 30 June.
Different entities have been established by the liquidator in Hungary to house different parts of the plant — Dunarolling for the rolling lines and Duna Furnace for the coke-making operations. This has sparked some talk the assets may be partially separated, but sources suggest the assets will be in one package, with only Dutrade and smaller entities split out.
The environmental licences based on the current blast furnace-based configuration are valid until 2027 and will not be extended after, meaning the buyer will need to invest in alternative technologies.
Liberty Steel Central Europe Kft, a Hungarian entity of GFG, has been invoicing buyers of material from Dunaferr. The company has been asking for proforma payment or payment within a few days of delivery, according to invoices obtained by Argus.
