On Monday the Italian government officially began lifting its nationwide lockdown on industry, services and business, after weeks of restrictive measures that were put in place to tackle the spread of the coronavirus. Construction and car manufacturing companies, key buyers for the top metals industries, were allowed to re-open, but only if they met safety protocols to protect the health of workers.
The re-opening of major steel- and aluminium-consuming business is expected to give these metals a much-needed boost, although is not clear yet how much this will help the Euro-zone economy get back on its feet.
Some Italian steel plants have already restarted operations in recent weeks thanks to the permission granted by local prefects, while most metals service centers were still shut down.
Italian steel producers lost 1 million metric tons to 1.3 million mt of crude steel output in four weeks of stringent lockdown and now they all have resumed production at around 40-50% of their capacity, with most of them filling pre-COVID-19 orders, mills executives confirmed. Industry sources said they are working with only about one month of market visibility.
Aluminum extruders were reported to be back at work too. “This is an important week in Italy, hopefully we will see some orders,” a European non-ferrous trader said.
“The Italians are opening. We started delivering ex-April quotas to all the extruders in the north and some to the south,” a European primary aluminum producer said. “The only sector I have heard is going well is construction, especially in central Europe, but a war is starting there as the Italian extruders are trying to gain their old market share.”
Italy is Europe’s second-largest steel producer, making 23 million mt last year. Total 2019 European steel production was 159 million mt, according to World Steel Association data.
According to trade association European Aluminium, some 20.7 million mt of aluminum were produced in Europe last year. Norway was the biggest primary producer. While Italy does not have primary aluminum operations, it is one of Europe’s biggest re-rollers and consumers of aluminum. According to Italian metals industry association Assofermet, Italy transforms around 780,000 mt of aluminium billets a year.
— Annalisa Villa, Emmanuel Latham
