Profits at steel canstock supplier ArcelorMittal slump

The world’s largest steelmaker and canstock supplier ArcelorMittal has reported a net loss of US$447 million for the second quarter (Q2) of 2019, compared with a profit of $1.87 billion a year earlier, following a sharp decline in steel prices and high raw material costs.

Overall sales for Q2 were $19.28bn, down from $20bn a year earlier.

“After a strong 2018, market conditions in the first half of 2019 have been very tough, with the profitability of our steel segments suffering due to lower steel prices combined with higher raw material costs,” said Lakshmi Mittal, ArcelorMittal chairman and chief executive.

Mittal stressed that global overcapacity remained a challenge.

“We have reduced capacity in Europe in response to the current weak demand environment, which has also impacted the turnaround of the ex-Ilva facilities in Italy,” he said. “Further action needs to be taken to address the increasing level of imports entering the continent due to ineffective safeguard measures and we continue to engage with the European Commission to create a level playing field for the sector.

“A supportive regulatory and funding environment is also crucial to our ambition to significantly reduce our emissions as announced in our recent Climate Action report.”

Mittal noted that further actions were being taken to adapt and strengthen the company and aimed at reducing its debt. The company expects global steel demand in 2019 to grow between 0.5-1.5 per cent.