Acerinox Q2 stainless steel output drops 8% on year

Spanish stainless steel group Acerinox’s secnd quarter melt shop output fell 8% year on year to 601,000 mt as demand for inventory building slowed into the third quarter, the company reported July 28.

The company said it also expects lower activity in Q3 due to seasonality and ongoing lockdowns in Asia, which had impacted cold-rolled production from its Malaysian Bahru Stainless division.

However, its global cold rolling output was up 4% year on year in Q2 to 416,000 mt and longs production was flat at 61,000 mt, the company said, leading to a record EBITDA of Eur523 million ($533 million) on sales of Eur2.5 billion and a revaluation of inventories.

Acerinox operates plants in Spain, Kentucky, US, South Africa and Malaysia with a combined melt shop capacity of 4.5 million mt/year, as well as high performance alloy facilities in Germany, which produced 44,000 mt in the first half of 2022.

Its US subsidiary, Kentucky-based North American Stainless, ran at full capacity in H1, while its Spanish operations at Cadiz reached “satisfactory” levels, it said, following interruptions in Q1 caused by a transport strike and record high energy prices.

Looking forward, Acerinox said it has observed a decline in orders from distributors which had rebuilt stocks depleted at the end of 2020, although its order book coupled with stable pricing in the US market meant it was optimistic for Q3.

However, the Russia-Ukraine conflict could cause more energy price issues and there were also doubts about energy supply in Germany.

Platts assessed domestic CRC prices in Northern Europe at Eur955/mt ex-works Ruhr July 27, down 10.75% since the start of 2022, according to S&P Global Commodity Insights.

— Gianluca Baratti