European steel output falls 2.6% as recovery stalls

Investing.com -- European steel production declined 2.6% year-over-year in April, according to Morgan Stanley, as a broad-based recovery in the EU27 and UK region has yet to materialize.

Global steel production fell 2% year-over-year in April, with China's output down 3%. World production excluding China decreased 1% year-over-year, while year-to-date figures showed similar weakness.

The regional performance across Europe showed mixed results. Germany recorded a 10% increase in output, while Austria rose 4%, Belgium gained 7%, and Italy climbed 7%. Sweden's production increased 5%.

In contrast, Spain's output dropped 22%, Poland fell 22%, and France declined 11% in April.

Outside Europe, growth was concentrated in India, which saw a 4% increase, Turkey with 9% growth, and the United States rising 9%. Russia's production fell 12%, while Ukraine declined 25%.

China's finished steel exports reached 9.5 million tonnes in April, up from 9.1 million tonnes in March and an implied January-February run rate of approximately 7.8 million tonnes per month. CISA member-mill data showed output down 4.5% in early May.

New European Union import regulations are set to take effect from July 1, 2026. The measures reduce import quotas by approximately 47% compared to 2024 levels and raise the out-of-quota duty to 50%. The Carbon Border Adjustment Mechanism also entered its definitive regime in 2026, increasing compliance requirements on covered imports.

Morgan Stanley maintains an overweight rating on ArcelorMittal, estimating that every $10 per tonne increase in realized regional prices would add approximately $0.6 billion to group EBITDA, equivalent to roughly 7% of 2026 consensus EBITDA.

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