Germany's steel companies have a tough time - the energy they need for their blast furnaces is expensive, and the steel prices of foreign competitors are often low.

Due to fierce competition from abroad and the weak economy, Germany's steel industry is producing significantly less steel. Domestic crude steel production fell by almost 12 percent to 17.1 tons in the first half of the year, according to the Berlin-based Steel Industry Association. A look at previous years clearly shows that the decline is extremely sharp: In the first half of 2023, crude steel production in Germany fell by 5 percent and rose by 4.5 percent in the first half of 2024. Now the figure is plummeting.

"The production slump in our industry demonstrates how dramatic the situation is for Germany as an industrial location," says the association's Executive Director, Kerstin Maria Rippel. Crude steel production is at the level seen during the 2009 financial market crisis. Steel companies are suffering particularly from weak domestic demand from key customer sectors such as construction, mechanical engineering, and the automotive industry.

"What we need now is a steel summit as a top-level meeting at the highest political level with our industry," says Rippel. It is crucial that those involved ensure the timely and reliable implementation of the known measures, such as effective European trade protection and competitive electricity prices. High energy prices, in particular, continue to place a heavy burden on competitiveness.

Politically, every effort must now be made to ensure internationally competitive and long-term reliable electricity prices for energy-intensive industries such as the steel industry," said the steel association head. "A first, urgently needed step is the rapid reduction of transmission grid charges."

Germany's steel industry has been under pressure for some time now. For example, the largest domestic steel producer, Thyssenkrupp Steel Europa (TKME), is struggling with losses and is relying on job cuts. The company had 27,000 employees at the turn of the year; by 2030, this figure is expected to fall to just 16,000 – through reducing production capacity and job cuts, as well as through outsourcing or selling off parts of the company.

Recently, after tough negotiations with the IG Metall union, management agreed on a tough austerity plan that will reduce an employee's income by an average of eight percent.