Antonio Marcegaglia is cautiously optimistic about European steel demand and pricing amid a highly uncertain landscape for the remainder of the year.
At Made in Steel in Milan last week, he told Kallanish he does not anticipate any decline in European demand, which will largely align with last year’s figures. Additionally, Europe may experience a positive impact from the German government’s decision to accelerate spending. The volume of imports is likely to remain limited due to the implementation of safeguard measures, the Carbon Border Adjustment Mechanism (CBAM), and additional duties.
In the latter half of 2025, Marcegaglia anticipates a gradual recovery in demand, contrasting with supply which is expected to remain stable. Consequently, pricing may stabilise at slightly higher levels compared to current figures.
The fluctuating dollar is the primary reason for the current decline in coil import prices. However, constraints on import volumes are mitigating the impact of this price reduction. The disparity between imported and European domestic coil prices is now becoming significant, but Marcegaglia claims that despite pressure from imports, there is no indication that European prices will decline, because of narrow margins.
Downstream margins were under pressure in the first quarter. However, the company recorded an improvement in February and March. Overall, Marcegaglia has observed a marginally improved performance in stainless steel relative to carbon steel.
The current climate of uncertainty has resulted in a noticeable deceleration in both private and public investment. Additionally, the decline in consumer goods consumption has hampered demand. The imposition of tariffs is adversely impacting global trade, which constitutes a crucial component of demand within the steel sector. Inventory levels have remained relatively low, and the first quarter has shown satisfactory performance regarding shipments, Marcegaglia observed.
“You build up your shipments day by day with a very short-term view. This again does not help prices and does not help margins … Demand is not so good, but also not so bad – but, price wise, we are seeing an increase from the very low levels of November last year,” Marcegaglia said.
“From those lows we can say that prices have been going up; but again, the Trump administration and the depreciation of the dollar are raising concerns regarding the sustainability of the price growth trend, so there is a kind of pause in the price increase momentum. In some areas, this is still going on; for example, in the tubes segment … but in other segments, prices are stagnating,” he added.
Seasonality is likely to provide a beneficial impact. The market may witness a gradual recovery in prices, as the current absolute price levels, particularly in Europe, are not significantly elevated, he adds.
Marcegaglia confirmed to Kallanish the firm is increasing investment in the relaunch of its For-sur-Mer steel mill, in southern France, formerly known as Ascometal, to €800 million ($902m), a “bold but necessary” move. “It is a partial upstream integration for both carbon and stainless steel,” he explained.
Stainless melting will continue to be carried out at the Sheffield unit, but re-rolling will happen in Fos. The project will cover approximately 30% of Marcegaglia’s needs of coil and slab procurement, which has been strongly impacted by the uncertainty associated with duties and the unpredictability regarding the future supply of steel in Europe, particularly as EU production trends down.
“Will there be enough melted steel in Europe in five to ten years time? I think it’s very wise and sound to have a partial integration of our needs and supply chain,” Marcegaglia noted. He added the company is negotiating long-term electricity pricing with the French government and EDF. Groundbreaking is planned for the beginning of next year.
Natalia Capra France
