Metallurgy in trouble!
The European steel industry is struggling with a large excess capacity – it currently amounts to over 400 million tonnes. EUROFER (European Steel Producers Association) reports that steel demand in Europe will fall by more than 3% this year. All previous forecasts only indicated a 0.4% decline. Such a slowdown is primarily due to uncertainty in global markets and trade and geopolitical tensions that negatively affect investment and trade flows. The decline in production in the automotive sector has a huge impact on the economic situation, where in Germany the production of passenger cars decreased by as much as 11%. The economic downturn and global oversupply in the steel industry increase the pressure on prices of finished products, while raw material prices, mainly iron ore, remain very high.
What’s next with Poland?
We get very bad information about the Polish steel industry, Arcelor Mittal Poland informs that it is forced to temporarily suspend the work of the raw material part of the Krakow steelworks. The installation stop process will begin on November 23, 2019.
Steel production is also limited at the Łaziska steelworks in Silesia. From the beginning of June, three production furnaces were extinguished. At the moment, no one is talking about dismissals.
The most important reason for the restrictions introduced is the increase in energy prices and CO₂ emission allowances. Less than a hundred people work with the furnaces off. That’s about one quarter of the crew.
Optimism and light in the tunnel only in Częstochowa. On Monday, October 28, production of the heavy plate mill resumed at the Częstochowa steelworks. The plant restart processing has been completed and returns to normal operation after a half-year break. The commissioning of steel plates and rolling mill means that Sunningwell International Polska has met the conditions stated in the lease document that it will resume production in Huta Częstochowa by the end of October.