ArcelorMittal will end primary steel production at its Duisburg site by October 2027, closing the steelworks entirely and shutting the billet rolling mill where roughly 800 people currently work, according to an editorial in American Thinker by Thomas Kolbe. About 550 employees could be affected by the closure. Only the wire rod mill is expected to remain, and the semifinished inputs it needs will in the future come from other ArcelorMittal sites and outside producers.
The announcement, which the piece describes as arriving at the end of the week, lands a double blow for backers of the green transition. Kolbe frames it as further evidence that hydrogen-based steelmaking cannot compete on cost — and, more troublingly, that even conventional steel production is gradually retreating from Germany altogether.
The subsidy money that was never spent
The green steel case in Europe rested on the idea that hydrogen could replace carbon as the reducing agent in steelmaking, cutting emissions without cutting output. Kolbe notes that ArcelorMittal was among the most prominent corporate champions of that vision. Roughly €1.3 billion in funding had been earmarked to convert its plants in Bremen and Eisenhüttenstadt, within an overall project estimated at about €2.5 billion. The plan called for direct reduction plants and electric arc furnaces, all ultimately running on hydrogen.
Then came the reversal: on June 19, 2025, the company announced it was ending those projects. According to Germany’s Ministry of Economic Affairs, the €1.3 billion was never drawn down. In Kolbe’s reading, the episode proves the point — even enormous public support could not make the venture profitable.
ArcelorMittal is not alone. The piece notes that thyssenkrupp and Salzgitter had already abandoned their own ambitions to produce green steel in Germany.
A cost gap no subsidy can bridge
The core of the argument is arithmetic. Depending on the calculation and production conditions, green steel raises production costs by roughly $100 to $500 per ton. For the European steel industry, converting to low-carbon methods is estimated to add between 35 and 100 percent per ton. Faced with markedly cheaper competition — from India or China, for example — someone has to absorb that gap. Kolbe asks whether taxpayers will be on the hook indefinitely.
The piece traces two subsidy channels intended to keep the industry’s conversion afloat. The first is direct grant money of the kind that went unclaimed by ArcelorMittal. The second runs through the EU emissions trading system, where energy-intensive producers like steelmakers receive free CO2 certificates. A company that emits less than its free allocation can avoid buying extra allowances and sell its surplus pollution rights to others. The mechanism, in Kolbe’s telling, makes conventional steel production relatively more expensive — an indirect thumb on the scale for the greener route.
Since January 1, 2026, the CBAM mechanism has added another layer of protection. It is not formally a tariff, but it functions similarly: carbon-intensive imports such as steel now face comparable regulatory costs imposed at the EU border. Even so, Kolbe argues, the barrier cannot change the underlying fact that industrial production in Germany has become unprofitable.
The numbers behind the retreat
German crude steel production has fallen from 42.4 million tons in 2018 — described as the best year — to 34.09 million tons in 2025, a drop of about 20 percent. Kolbe calls that decline a dramatic indicator of what he sees as a failure of German energy and industrial location policy.
The editorial points to former Economy Minister Robert Habeck, whom it calls the guiding spirit of ecological central planning, as the political face of the green steel push. Habeck considered green steel “Made in Germany and Europe” indispensable, convinced that coal-produced steel had no future on the world market. Kolbe writes that events have shown how wrong that conviction was.
The broader complaint is about state intervention in price formation and technology choices. Subsidies do not make costs disappear, the argument goes; they redistribute and conceal them. When the state repeatedly steers the economy, scarce resources stop flowing to where competition would generate the most benefit and instead end up with those best at hunting grants. That, Kolbe concludes, is how the final chapter of the market economy begins.
The German steel pullback fits a pattern of growing skepticism about the economics of industrial decarbonization, particularly in energy-intensive sectors facing global competition. The basic materials industry sits at the base of industrial value chains, and with geopolitical tensions running high, secure domestic access to raw materials and primary products carries strategic weight — a point the editorial stresses in arguing that the retreat has consequences beyond the balance sheets of individual firms. Whether Brussels and Berlin adjust course, or continue betting on subsidies and carbon border measures to keep the transition alive, is now the central question for Germany’s industrial base.
Source: www.americanthinker.com — https://www.americanthinker.com/articles/2026/09/green-steel-arcelormittal-finally-pulls-the-plug/