The steel market in Europe is showing signs of bottoming out, according to the world's largest steel producer ArcelorMittal.
While weak demand in the auto industry means the recovery has not yet begun, steel prices in the European Union are struggling to rise, said Gert van Poelvoorde, CEO of a rental company in Europe. ArcelorMittal announced a cut in European steelmaking last month as the market came under pressure as US tariffs redirect dumping supplies to the EU and higher iron ore prices drive up costs.
"If the global economy remains as it is today, the metallurgical industry is likely to have crossed the bottom," Poelvoorde said. “I really hope that the price drop has already passed.”
Hot rolled coil prices in Northern Europe rose by € 15 per tonne to € 480 for the week ending June 3, the largest increase in a year, according to Kallanish Commodities.
ArcelorMittal joined other European steelmakers in writing an open letter to EU leaders last week, saying that without stronger import restrictions, the industrial crisis in the region would worsen.
The market could start recovering in the fourth quarter of this year if there is a recovery in the auto sector and if the European Commission restricts imports of cheap steel flooding the continent, Poelvoorde said. If regulators don't do their job, he said, the European industry will continue to shrink.
On Friday, the commission said it would expedite its steel import investigation, which was previously scheduled to be completed by the end of September.
