Renfe Goodsa merchant subsidiary of the public railway operator, has sealed peace with the steel company ArcelorMittal after more than a month of tense talks to renegotiate the contract that bound both parties to transport material from the steel mills in Asturias to different points on the peninsula, such as Sagunto, Bilbao, Irún or Portugal, among others.
As this medium has learned, Renfe lost almost a million euros a year by not being able to pass on the increased costs linked to the service to its client, which led to a substantial deficit of close to one million euros per year. Until now, the rate for the Luxembourg company, the largest metallurgical company on the planet, had remained stable.
To the impossibility of adjusting the rate applied to the actual cost of the serviceadded to the condition caused by the drop in production at the factories that ArcelorMittal has in Gijón and Avilés. Also the low wagon turnoverwho spent several days in the plants owned by the steel company, which gave rise to a very low turnover of the material in the hands of Renfe.
The listed company also acquired new wagons years ago, has intensified their use and transferred its traction to Renfe’s main competitor, the Captrain gala (SNCF subsidiary). This affected the volume of activity assigned to the public company, without Arcelor offering a transition for these traffic. Therefore, Renfe moved trains with less and less materialand sometimes they were even empty, having to fulfill services included in the original contract but without cargo.
ArcelorMittal sources acknowledge elEconomista.es that the differences were in the fact that the service “was not enough”which caused merchant traffic to its facilities to be paralyzed, without affecting production. From the listed company they trust that the new contract will allow normality to be restored.
They did not think the same in the company chaired by Raül Blanco, from where they slip that the existing service offered low profitability which had been shattered a long time ago given the demands of the steel company and the decline in business. All this would have caused a operating deficit that Renfe estimates at 11 million eurosa value impossible to cover with the income that ArcelorMittal reports annually to its accounts.
Renfe assures that they tried to renegotiate the conditions since May without much success, trying to convince their client to set minimum volumes to minimize production drop due to demand adjustments or closures of blast furnaces, without them being accepted.
The situation reached the point of alerting ArcelorMittal of the possibility that, if this deficit was perpetuated, it could be interpreted by the General Administration Intervention (IGAE). as state aidby offering a public service at a loss on a recurring basis.
Despite this, ArcelorMittal did not accept the price increase until the railway operator train traffic was planted and paralyzedstopping traffic for just over a month until the new agreement has been signed. In 2023, Renfe transported 825,491 tons for ArcelorMittal, of which 92.8% were moved in electric traction and ‘zero emissions’ trains.
36.09 million
Renfe Mercancías lost in fiscal year 2023, slightly improving the 38.4 million ‘red numbers’ recorded a year before. The merchant subsidiary of the public operator invoiced 9.5% less than the previous year after the loss of traffic and a drop in tons transported (-19.4%); as well as the increase in costs, mainly labor costs. Steel trade reported income of 14.19 million euros.
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