Steel Giant Arcelor Mittal Announces Steel Output Cuts in Europe for the Second Time in a Row
Driven by the weak demand and rising imports, the world’s largest steelmaker, ArcelorMittal said on Wednesday that it will further reduce steel production in Europe.
The steel mammoth said that it will lower primary production at its facilities in Dunkirk, France and Eisenhuettenstadt, Germany and reduce production at its site in Bremen, Germany in the fourth quarter of this year. The company will also extend a repair-related stoppage planned for the fourth quarter at its plant in Asturias, Spain. ArcelorMittal said its latest cuts amounted to annualised output of 1-1.5 MnT.
Today’s cuts announced are the second in the row as in early May this year, the company had declared its plans to cut steel output across Europe by 3 MnT annually. According to the plan the production would be idled at steelmaking facilities in Krakow, Poland, and would be reduced in Asturias, northern Spain, the steelmaker would also slow down the relaunch of production in Italy at the former Ilva plant in Taranto.
However, the company said that these are temporary measures and the production cuts would be reversed when market conditions improve.
ArcelorMittal has steelmaking plants in 18 countries worldwide, with 47% of its steel produced in Europe. When publishing its 2018 results, the company had cut its forecast for demand in Europe predicting a contraction due to weak manufacturing and declining automotive production, for which steel is a major input. ArcelorMittal has steelmaking plants in 18 countries worldwide, with 47% of its steel produced in Europe.
EU’s grappling steel industry
The European steel market is struggling especially since the past year after U.S. announced tariffs on its steel imports. This is because the key steel exporting countries are diverting their excess supplies to Europe at cheaper rates despite the EU imposing safeguards on its steel imports.
The production cuts from Arcelor Mittal has come after another steel biggie in European region British Steel, collapsed into liquidation last week, putting 25,000 jobs at risk unless it finds a buyer.
Subsequently, the European Commission is undergoing a review of its “safeguard” measures to limit incoming steel and prevent a surge of imports as a result of increased tariffs effectively closing the U.S. market.
source: SteelMint
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