In conditions of deepening crisis of the coronavirus worldwide, the second largest steel production company in the world ArcelorMittal has expressed concerns that its sales and profitability will be under threat in 2020 in the case of wide spread of the virus in Europe, especially in Italy.
In Italy, the epicenter of the epidemic in Europe, the death toll has risen to more than 230, and the number of confirmed cases - up to 5800, which puts the country in third place after South Korea and China, where the virus was first discovered in December.
ArcelorMittal announced that it expects growth in steel demand in China in 2020 in the range "from + 0.0% to + 1,0%" (compared to the anticipated growth of 3.2% in 2019), due to active real estate transactions, as well as the current sight of the company for the coronavirus.
the annual report says that the exact impact of the coronavirus is not known, but it has already had a negative impact on prices and spreads in China, and the situation may continue if the stocks in the factories in China continue to rise, exerting downward pressure on prices.
the Company expects a significant negative impact of the pandemic on industrial production and steel demand in the first quarter of 2020 and added that the GDP growth and steel demand will likely be weaker than previous estimates.
In 2019, the revenues of ArcelorMittal amounted to 70.6 billion U.S. dollars, the production of steel and 89.8 million tonnes, while own iron ore production amounted to 57.1 million tons.
In November 2018 ArcelorMittal completed the acquisition (through long-term lease) of a plant ILVA renamed to ArcelorMittal Italia, Europe's largest and the only one in Italy steel plant, the main production of which is located in Taranto. ArcelorMittal Italia also has significant facilities for the processing of steel in Taranto, Novi Ligure and Genoa.
Previously coalsalesthat the Italian government has promised to amend the ArcelorMittal ILVA same investment, how much was made AM InvestCo, with the purchase of the plant, which provides the basis for "an important new partnership between ArcelorMittal and the government of Italy". If the investment agreement is not executed until November 30, 2020, AM InvestCo has the right to withdrawal is subject to the agreed payment, said ArcelorMittal.
Recall that the largest metallurgical companies of Ukraine, Metinvest Savile about the possible negative impact of coronavirus on prices and stability of the steel market in General.
