Day: 28 July 2023

Crude steel output at ArcelorMittal’s European unit fell by over 2 million tonnes year-on-year during the first half of 2023 to 14.7mt, Kallanish learns from the group’s latest financial results.

The performance was impacted by the outages at blast furnaces in Gijon, Spain and in Dunkirk, France. Both units restarted in mid-July. The idling of the furnaces came amid the general weakness of the European market.

In the second quarter alone, crude steel production fell 16% y-o-y to 6.9mt.

Shipments of steel products decreased by less than production, with a fall of 1.3mt y-o-y to 15mt in H1 2023.

ArcelorMittal has significantly decreased its outlook for apparent steel consumption in Europe. It is now guiding for European demand this year to move in a range of 0.5% decline to 1.5% growth versus 2022.

The demand outlook was cut mainly due to lower-than-expected demand registered in the construction sector; ArcelorMittal still expects demand for flat products to recover this year.

Emanuele Norsa Italy

German rebar buyers are increasingly confident the price floor has been reached after the base price sunk to €330/tonne ($363) at the end of June.

“Apparently, a point has been reached at which the mills are not willing to follow the downtrend any longer. It will be risky to keep speculating on a further drop of prices,” one commentator of a central German distribution house writes in his blog.

Managers in southern Germany concur. “It would not make sense for mills to produce for less,” one says. “Mills want to go back up to €350/t and have set signals for it, with [output] reductions in the holidays and by means of short working hours,” another observes.

Sources in Germany and Austria told Kallanish earlier of such efforts to lift prices by some €20/t in order to achieve market stabilisation. One northern German source notes offers early this week were at €370/t for smaller orders, but adds that he himself has no reason to order at present.

In fact, the hike attempts might ultimately not be accepted in the market. “Any hike attempt this summer might be a short rebellion, but it will not gain lasting ground,” one German buyer finds. One Austrian is even more critical: “Mills have tried all year so far to bring up prices, but I see them softening still further,” he states, citing falling scrap values and demand not kicking in.

Christian Koehl Germany