The European steel industry has been severely impaired by the ongoing lockdowns implemented by most EU governments to curtail the spread of COVID-19, according to the European Steel Association (Eurofer).
Production declines, employee layoffs, and capacity idling have rendered the continent’s economic outlook gloomy. The steel consumption forecast for the remainder of 2020 has been slashed.
Eurofer cannot estimate when full production will be restored, however, it assumes, based on the deconfinement rules set by all EU governments, that production might slowly begin in Q3.
Even in 2019, before COVID-19 turned into a full-blown pandemic, the European steel industry struggled, as steel consumption declined by 5.3pc from 2018.
By H2 2019, the European steel industry had become subdued because of the continent’s trade war with the US, ineffectual steel safeguards devised by the EU’s central government, and the uncertainty surrounding Brexit. Steel consumption in Q3 2019 declined by 1.6pc compared to Q3 2018, and steel consumption in Q4 2019 declined by 10.8pc compared to Q4 2018.
Growth in Europe’s steel industry this year will ultimately be determined by the global restrictions on economic activity, Eurofer said in a statement.