Atradius, the world’s second-largest credit insurer, has observed a weakening of the German steel industry this year and sees continued trouble in connection with the overall industrial transformation.
Atradius’ German branch observes that results and forecasts of mills and downstream customers have become cloudier, after relatively good results in the two previous years. The prior period was buoyed by a catch-up effect following the Covid-19 interruption. While this observation is not all new, Atradius adds the perspective of the credit insurer. It states that payment failures of borrowers in the first half have gone up notably, in numbers as well as in volume.
“Our underwriters report that companies keep stretching their due dates for payment in their purchasing activities,” Kallanish hears from Atradius country director Frank Liebold. “Companies are obviously worried about their liquidity, and try to get more leeway,” he adds.
Due to the transition from combustion to electric engines, many automotive suppliers are facing troubles for which they cannot compensate with other sales. “Especially small and medium-sized steel and metals users are troubled by lower demand, because they often serve defined customer groups, and cannot easily divert into other sectors,” Liebold says (see related story).
Christian Koehl Germany
