ArcelorMittal trims steel demand forecasts as tariffs dampen US sentiment

By Anna Peverieri

July 31 (Reuters) - ArcelorMittal MT.AS, the world's second largest steelmaker, cut its steel demand forecasts on Thursday, saying President Donald Trump's tariffs were taking a toll on U.S. consumption even as European demand held up somewhat better.

The Trump administration rolled out some of its first trade measures with a 25% tariff on most imported steel and aluminium in March. It doubled the rate to 50% for most countries in June.

The Luxembourg-based group lowered its annual forecast for global steel demand outside of China, the world's top consumer and producer of the metal, now seeing growth of 1.5% to 2.5%, compared with the February forecast of 2.5% to 3.5%.

It said tariff concerns and subdued economic activity had dampened demand in the U.S., where apparent steel consumption was expected to be unchanged or decline by up to 2% in 2025, down from 1-3% growth previously.

Tariffs would also have a limited impact on Europe, although demand was holding up better there than other regions, it said, estimating growth between -0.5% and +1.5%.

The comments about Europe come in contrast with more downbeat views from European peers, with Acerinox and SSAB having earlier flagged weak demand, high inventories and tariff-driven market uncertainty.

Finance chief Genuino Christino attributed ArcelorMittal's more positive view on Europe to its large exposure to the automotive sector, which he said was holding up relatively well despite a slowdown in global car demand.

The company was also seeing early signs of recovery in the construction market, which it expects to materialise in 2026, Christino told Reuters.

The European Union's carbon border tariff (CBAM), set to kick in fully from January 2026, could meanwhile help European steelmakers regain market share lost to cheaper Asian imports, he said.

The CBAM aims to shield domestic producers from unfair competition and prevent industrial flight to regions with looser climate rules.

ArcelorMittal's quarterly core earnings (EBITDA) were broadly in line with market expectations at $1.86 billion, helped by a higher contribution from India and improved selling prices that outpaced input cost growth in Europe.

Its shares were down 3.4% at 0727 GMT.