Lemvigh-Müller champions low-emission industry with Outokumpu Circle Green®

Lemvigh-Müller, Denmark’s largest and oldest wholesaler of steel & metals and technical goods, is setting a high standard for CO2-reduced procurement. It put sustainable stainless steel as an important focus area of this strategy, with Outokumpu’s Circle Green, the world’s first towards-zero carbon stainless steel, forming the backbone.

The 177-year-old company recently committed to the Science Based Targets initiative (SBTi), which provides companies with a clearly defined path to reduce CO2 emissions. Lemvigh-Müller’s target is to reduce Scope 1 and 2 emissions by 50.4% by 2032 while aiming for a 30% reduction in the emissions of purchased goods for Scope 3 – which relate specifically to Circle Green – within the same timeframe.

The supply of CO₂-reduced material is an essential step in reaching these science-based targets. Hence Lemvigh-Müller has begun stocking Circle Green, with a carbon footprint up to 93% lower than the industry average. “Our success in meeting these ambitious goals heavily depends on cooperation throughout our entire value chain. That’s why we’re relying on close partners like Outokumpu who share our ambitions,” says Pernille Kiær, Head of Sustainability at Lemvigh-Müller. 

“Our partnership with Outokumpu dates almost a century back, making them our oldest supplier. This enduring alliance is even more important today as we pursue CO2 reductions, with Circle Green stainless steel playing a critical role in meeting our emissions targets. We are already stocking a number of Circle Green grades. It’s imperative to convince our customers why they need to invest in low carbon materials.”

Outokumpu currently supplies Lemvigh-Müller with Circle Green Core 304L and Supra 316L in cold-rolled, hot-rolled, and polished versions. “We analyzed our best-selling, high-demand products to prioritize the fast movers in our shift towards sustainability,” explains Palle Thomassen, Lemvigh-Müller’s Director of Stainless Steel. “As a result, we started stocking these grades from October 2023. As the market matures we aim to have our entire stock of cold-rolled and hot-rolled sheet stainless steel composed of Circle Green, hopefully within three to five years.” 

Cutting emissions internally

In terms of reducing its Scope 1 and 2 emissions, Lemvigh-Müller is in the process of setting up  solar panels at its facilities where feasible, along with transitioning to electric vehicles. Since its commitment extends to helping its customers minimize CO2 emissions, Lemvigh-Müller is also using HVO 100 biodiesel instead of conventional diesel for its delivery vehicles for their technical products

Customers are also increasingly expecting to be given environmental data on the stainless steel products they purchase from Lemvigh-Müller, marking a significant shift in the industry. As a result, the company dedicates substantial time to compiling data on its product range. “In this regard, we’re delighted with our partnership with Outokumpu. Because they have taken the lead in providing CO2 data in terms of PCF (Product Carbon Footprint) not only for Circle Green but also the other stainless steel products they supply to us,” adds Pernille.

The growing appeal of Circle Green

Some of Denmark’s major industries are pharma and dairy, which require their suppliers to supply steel with the lowest carbon emissions for use in process equipment. According to Pernille, some of Lemvigh-Müller’s large customers are becoming increasing inclined to purchase Circle Green as part of their sustainability reporting. 

“These customers must demonstrate to stakeholders their commitment to sustainable practices, many of which have also committed to science-based targets. Moreover, the necessity for them to adhere to the new European Sustainability Reporting Standard, effective this year, fuels the current demand for CO2-reduced products like Circle Green.”

Regarding pricing, the company’s committed customers understand that a premium may apply when purchasing a novel product like Circle Green where the strive for a zero emission stainless steel comes with an even more intensive sourcing for high quality scrap, low emission nickel and other raw materials and energy sources.

Dual procurement options for varying preferences 

One of Circle Green’s most important features is that it performs identically to Outokumpu's “standard” stainless steel.  Palle explains, “

We know that Outokumpu’s standard stainless steel and Circle Green share the same well-known superior mechanical and surface properties. That means customers can make the change without worrying about requalification of their material. Interestingly, in discussions with discerning end-users, we find that they are already aware that Outokumpu offers a best-in-class footprint of 1.7 tons of CO2 for regular grades, compared with Circle Green that boasts emissions of just 0.5 tones per ton.

“This situation works in our favor, as it allows us to cater to different customer preferences and environmental goals by offering two viable options.” 

An educated sales force makes the difference

The collaborative success with Outokumpu is, among other things due to Lemvigh-Müller’s focus on training and educating its sales teams effectively in marketing and selling Circle Green. This includes justifying the premium price to customers and the significance of choosing it over others. 

According to Pernille, Lemvigh-Müller’s sales personnel must convey the environmental benefits and back them up with solid documentation such as EPDs. The company also stresses the importance of ESG (Environmental, Social, and Governance) considerations, including ISO certifications and verifying the credibility of its suppliers.

“The selection process now extends beyond carbon reduction to include criteria like anti-corruption measures and human rights adherence, reflecting the increasing concern of customers. Indeed, it's not solely about carbon anymore; it's about the entirety of the ESG framework. To ensure this approach resonates effectively with our customers, we've implemented numerous training sessions to equip our sales staff with the knowledge and skills for meaningful customer engagements regarding Circle Green.”

Embracing a dynamic change in direction

Given the rapid pace of the green transformation, Lemvigh-Müller understands the need to stay ahead, recognizing its responsibility as a market leader. “Bolstered by our longstanding relationship with Outokumpu and our commitment to products like Circle Green, we are well placed to embrace this dynamic new direction fully,” Palle concludes.