Spain’s April steel output drops to record low

The Spanish steel sector’s activity continued to be sharply impacted by the Covid-19 outbreak in April, registering a record low and raising many concerns within Spanish steelmakers’ association Unesid.

According to preliminary data, the local steel sector produced around 680,000 tonnes of crude steel in April, a drop by -48% year-on-year, Unesid says. As a comparison, in a typical July or December, when activity is usually most reduced, Spanish output ranges from 900,000t to 1 million tonnes. The lowest monthly production registered during the last financial crisis in 2008/09 was 725,000t, says Unesid director of economic studies Alfonso Hidalgo de Calcerrada García.

The fall in output was seen in almost all steel products, although it was greater in the automotive sector, which was practically halted in April. Long steel products output used in the construction sector, meanwhile, decreased -30-40% y-o-y in April. Only tinplate output continued at its usual rate given its need in the food industry.

“We have to be aware of the seriousness of the situation,” Garcia says in a note seen by Kallanish. “The deterioration is so great that the removal of restrictions on its own will not guarantee a recovery. It is necessary to boost the restart of the industrial sector in general and the production of steel in particular.”

“The steel-consuming sectors need to return to their pre-confinement activity, either by promoting private demand, as in the case with automobiles, or directly through public actions, as in construction,” he adds.