Iberdrola and Sidenor publicly clash over steel and energy prices



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Iberdrola has labeled the rise in steel as “disproportionately inexplicable”. Sidenor has expressed his “surprise” and has attributed the statements to “poor knowledge on the part of Iberdrola” of the situation.

The company Iberdrola has asked Sidenor to lower steel prices in order to continue competing in the development of global wind energy and specifically in the installation of offshore wind farms.

On October 28, the CEO of Iberdrola Spain, Ángeles Santamaría, and the chairman of Sidenor, José Antonio Jainaga, publicly disagreed on the increase in energy, which for the electricity company has only affected less than 10% of its clients and for the steel industry, it will lead to the closure of industries in six months.

On Tuesday, Iberdrola sources assured that numerous clients of the Basque steel company have considered that it should lower prices, since they are observing a rise that they consider “disproportionately inexplicable” that does not correspond to the increase in energy prices .

These power company sources believe that Sidenor is selling its products with competitive power supply prices closed for some time. “There are no objective reasons to charge steel prices as it is charging them,” they say.

They add that the electric ones, among which is Iberdrola -of which is not a Sidenor client- are offering to the company chaired by Jainaga fixed competitive prices for a long time.

According to these sources, Iberdrola offered Sidenor a price of € 40 / MWh for 10 years, and Sidenor declined to accept the proposal.. The Basque energy company has reached agreements with other steel companies in the Basque Country to set prices until 2023.

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The power company has concluded by ensuring that fixed prices are possible if there are no drawdowns or auctions in the market that imply a greater risk in business costs, something that each company decides freely.

Sidenor responds to Iberdrola

Sidenor has responded this Wednesday to Iberdrola. Before the “inaccurate” claims of the electric company on its activity, Sidenor has expressed his “surprise” and he has blamed them on “poor knowledge on the part of Iberdrola” of the situation and the activity of the steel company.

As he has specified, Sidenor’s special steel production is directed mainly to the automobile market and sales to the offshore wind industry are “absolutely marginal” with respect to the company’s total sales, representing less than 2% of said total.

In this context, it has asserted that the influence of Sidenor prices on the development of global offshore wind energy can be considered as “practically nil”.

On the other hand, he pointed out that until October 31, Sidenor has not applied any price increase as a result of the increase in electricity prices, being the company the one that has so far endured the “excessive” rise in the price of electricity against your bottom line. “Only in October this rise has meant a reduction in its Ebitda of 8 million euros,” he stressed.

That said, he has ensured that “It is not true that Sidenor is buying electricity through a closed price contract “.

“Since February of this year, when the rise in electricity prices began, Sidenor has not received any offer from Iberdrola that allows it to face such negative price evolution,” said the industrial group dedicated to production of special long steels.

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George Holan

George Holan is chief editor at Plainsmen Post and has articles published in many notable publications in the last decade.

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