* U.S., European customers taking wait-and see approach
* CEO cites seasonal factors for second half slowing
* Inventories in both regions remain low
(Updates with link to second graphic, groups both together)
By Carole Vaporean
NEW YORK, June 22 ArcelorMittal (ISPA.AS), the
world's largest steel maker, said on Tuesday that apparent and
real demand for steel remains positive in the second quarter in
the United States and Europe, but would be slower in the second
half of the year.
"I still believe we will have 10 percent growth in global
(steel) demand this year," Lakshmi Mittal, chairman and chief
executive of ArcelorMittal, said at American Metal Market's
25th Steel Success Strategies conference.
He added, however, that the geographic distribution will
have a different profile than before the global recession.
Before the financial crisis, he said, demand was divided
evenly in thirds among developing countries, developed
countries and China. Now, however, China consumes 50 percent of
global steel, he said.
The CEO added that he did not see total steel demand
returning to "pre-crisis" levels until 2012, and that a
restructuring of the global industry may be necessary.
Graphic comparing shares of ArcelorMittal and U.S. Steel
Graphic showing iron, steel and U.S. economy
Asked by Reuters about the demand outlook for the second half of 2010,
Mittal said he saw it was slowing for seasonal reasons.
"But once you take out the seasonality factor, things will
start to improve," he said.
In Europe, "customers are taking a wait-and-see approach.
At the same time, inventory levels are still low," Mittal
"We are also seeing U.S. customers taking a wait-and-see
approach after restocking, but inventory levels are still low
Asked about different customer sectors, Mittal said:
"Housing is clearly still weak. Autos are still strong. The
capital goods market is starting to improve and engineering is
starting to improve."
In response to questions about comments earlier this month
that ArcelorMittal was considering halting up to three European
blast furnaces in the third quarter [ID:nLDE65214X], Mittal
said, "We said we will be producing what our customers want."
He explained that ArcelorMittal had learned during the
global econmic downturn how to operate at lower capacity if
demand does not pick up.
"This is part of our contingency plan, if demand slows down
in the third quarter. We are prepared to shut down our blast
furnaces. We have made no decision on that yet. We will decide
as the quarter progresses," the CEO said.
(Reporting by Carole Vaporean; Editing by Walter Bagley)