EU demand remains below pre-crisis levels: ArcelorMittal

ArcelorMittal’s production, shipments and sales recovered in Europe during the third quarter, but did not return to pre-Covid-19 crisis levels.

In June-September crude steel production was up almost 12% on-quarter to 7.9 million tonnes, but it still remained some -25% below Q3 2019. Steel shipments also recovered strongly, but remained down -15% on-year, Kallanish notes.

“Demand and activity levels have gradually improved, as lockdowns eased through 2Q 2020 and into 3Q 2020, particularly with automotive and manufacturing restarts,” the steelmaker says. “As a result, the company resumed some steel-making capacity in France, Spain and Germany, with some of the restarts required to ensure continuity of supply to customers during the planned major reline of a blast furnace at Gent, Belgium that began late August 2020.”

“Nevertheless, demand has not yet recovered to pre-crisis levels,” the group points out.

Sales in Q3 in Europe surpassed $7 billion, -20% down on Q3 2019 but up 21% on-quarter. Thanks to the recovery of sales prices, in particular, spreads and average steel selling prices in Europe recovered, but the company still registered an operating loss of $342 million.

“Given that inventories in the system are relatively lean, recovering demand has seen steel spreads return to more normalized levels from the unstainable lows seen at the end of 2Q’20,” the company explains.