WASHINGTON ArcelorMittal SA expects limited inventory restocking to benefit its U.S. operations in the first half of 2013 following rising demand coupled with inventory cuts in the fourth quarter of 2012.
"Underlying real demand appears to still be on a rising trend in the United States, while the eurozone appears to be stuck in a mild recession," the company said in its 2012 annual report released April 30. "In both markets, inventory levels were cut during the fourth quarter of 2012, which should support demand to a limited extent during the first half of 2013."
The Luxembourg-based steelmakers flat carbon Americas segment includes ArcelorMittal USA LLC, ArcelorMittal Dofasco Inc., ArcelorMittal Brazil and ArcelorMittal Lazaro Cardenas.
Hot-rolled coil spot prices reached a peak of around $800 per tonne in the U.S. market in February last year, up from $750 at the end of 2011, the company said, reflecting stronger demand from the automotive, energy and machinery sectors.
Market sentiment weakened during the second quarter of 2012, however, due to destocking efforts, combined with oversupply and lackluster demand, leading hot-rolled coil prices to fall some $150 per tonne to as low as $650 per tonne by the start of the fourth quarter.
The company said that hot-rolled coil spot prices for late-first-quarter delivery were $660 to $695 per tonne.
Looking forward, the producer said that the U.S. market looks promising, particularly as the automotive and housing sectors continue to strengthen.
"In the United States, an improving labor market (and) rising availability of credit and low interest rates, coupled (with) pent-up demand, is helping both auto and housing output to grow, supporting expected (apparent steel consumption) growth of 3 to 4 percent in 2013," the company said.