Luxembourg-based producer ArcelorMittal is the only firm that is allowed to continue producing steel at its Taranto site in Italy after the government tightened measures on non-essential industrial activity over the weekend in its continuing fight against the spread of the coronavirus.
Taranto produces using a blast furnace, and as such it falls under the clause of the new decree, exempting businesses in a continuous production cycle. If the furnace were to stop, it would result in significant financial damage to the company.
But Arcelor’s other steel-producing assets in Italy, as well as all other mills, service centres and producers, are required to temporarily shut down until 3 April.
According to the decree, appointed regional authorities are to decide if the continuous operation of a business is essential or not, and whether it is ‘strategic’ for it to continue working. Any producer in the aviation or weapons production chain is exempt from the restrictions.
Other steelmakers are understood to be trying to prove to the respective regional authorities that their operations must continue. In addition, purchasing of scrap from abroad is understood to be continuing, likely as a result of an anticipated shortage in the country owing to reduced scrap flows, as the country is under lockdown.
ArcelorMittal and the Italian government agreed at the beginning of March that the government would take a stake in Ilva. The company last week confirmed to Argus that it had decided to slow output across Europe and in Italy, halving the workforce in Taranto to 3,800 workers in a bid to stop the spread of the virus.
By Lora Stoyanova
