Argentina’s steel industry expects an improving national economy to boost steel demand in 2020, but acknowledges there will also be headwinds.
The demand will largely be driven by new construction projects, including in the energy and transportation industries.
The industry also intends to increase exports to maintain stable production, according to a joint report from ArcelorMittal Acindar, Tenaris Argentina, and Ternium, called Vision 2020: steel and metallurgy, published by Argentina’s steel industry chamber.
But the local economy isn’t likely to recover quickly enough, said Marcelo Marino Pena Luz, ArcelorMittal Acindar’s chief executive officer, adding slow recovery will impact steel demand next year. However, Pena Luz also said the company will do everything in its power to maintain production levels and will focus on the external market.
The steel industry will face some challenges in 2020, due to low local demand and a turbulent international market that’s driven mainly by the changing trade relationship between China and the US, said Javier Martínez Álvarez, president of Tenaris Cono Sur.
Tenaris will focus on the oil and gas market, both nationally and internationally, next year. This year the steelmaker has been focused on developing its Vaca Muerta project, as well as exporting seamless tubes to the US, Middle East, and Africa. The company did not disclose volumes.
The next year will be a period of transition with the possibility for growth until 2021, according to Martín Berardi, president of Ternium Argentina.
The steelmaker is waiting for clearly defined policies from the new government before investing in some projects. In the interim, Ternium will focus its investments on the environment, security and industry 4.0, as well as programs aimed at the community.
Alberto Fernandez will be Argentina’s next president after winning an election dominated by economic issues. Current President Mauricio Macri conceded defeat and will hand over the reins on December 10, 2019. Argentina’s crude steel production dropped 14.4pc to 381,800mt in October 2019 compared to the same month last year, according to figures from the Argentine Chamber of Steel.
Production fell as a result of lower demand for products supplied to the construction and automotive industries, it said.