ArcelorMittal Warns on Steel Demand as Earnings Hit 3-Year Low

(Bloomberg) -- ArcelorMittal delivered more bearish news for the steel industry, saying global demand could be weaker than previously expected as the company struggles with low steel prices and high costs for raw materials.

• The company, the world's biggest steelmaker, said Ebitda fell 49% to $1.6 billion during the second quarter. It's the lowest results for the company since early 2016.
• It also reported an operating loss of $0.2 billion for the quarter, citing asset writedowns and sales after its Italia acquisition.

Key Insights

• ArcelorMittal said global steel demand will increase 0.5% to 1.5% this year, cutting the low-end of the forecast. In May, the company said demand worldwide would be at least 1%.
• Europe remains the weakest region. Steel demand could contract as much as 2% in 2019, ArcelorMittal said. The industry has been hard hit by a slowdown in sales, caused by Germany's weak auto industry and competition from cheaper imports. A surge in iron ore is also making it more expensive to churn out steel.
• "Market conditions in the first half of 2019 have been very tough," said CEO Lakshmi Mittal. He urged European regulators to take action and limit steel imports, saying the industry needs to create "a level-playing field."

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• Key figures here
• Statement here

To contact the reporter on this story: Elena Mazneva in London at emazneva@bloomberg.net

To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net, Liezel Hill

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