ArcelorMittal is reviewing its forecasts
One of the leaders of ArcelorMittal steel industry, which produces about 6−7% of steel production in the world is revising previously made a forecast for the current year. Concern Experts believe that the demand for steel products will grow not on the previously mentioned 1.5−2% and 0.5−1.5%. The change was based on the situation in the United States, Brazil and CIS countries. In these regions, the consumption of steel products will drop by 2−3%, 5−7%, 5−7%, respectively. In China, consumption, by contrast, will grow by 0.5−1.5%. In European countries also expected to increase in the range of 1.5−2%, whereas in the past, the increase was 3.5%. Of ArcelorMittal, taking into account the annual figures, it plans to increase shipments of products by 3−5% compared to last year's results.
The company reduces production capacity. Today decided to close in IIIkvartale 2015 production of wire rod, in South Carolina. According to the company, such a decision justified by the prevailing market conditions. Production was inefficient due to high transport costs. Also take into account the availability of cheap Chinese imports, the high cost of scrap and increasing prices for electricity. The main influencing factor is indicated 36% of the volume of imports of wire rod from the PRC and other countries of the total US market. Moreover, this figure was reached in January-March 2015.
In 2009, ArcelorMittal had already stopped this production. Restarting in February, and the company has suffered sizable losses, taking into account the cost to restart the presence of cheap imports and rising costs. The increased price of scrap also adversely affects the cost. In addition, the company is forced to transport the raw materials by truck, that adds stability when calculating costs.
When closing the factory jobs will lose about 226 employees. This situation may play into the hands Charter Steel and Nucor Darlington. In addition, while reducing the volumes produced wire rod prices are explainable increase. According to the ArcelorMittal company together with the Department of Employment and Manpower develops a smooth transition plan for workers who have lost their place. The final stage of the closing is supposed to be completed by September this year.