Eurofer says EU steel faces unprecedented downturn

The European Union steel market is facing "an unprecedented downturn" this year, with no respite seen until 2010, European steel confederation Eurofer said on Thursday.
"The significant deterioration in economic fundamentals since autumn 2008 is fully reflected in the outlook for the EU steel using industries," a Eurofer statement said.
The EU's 27 member countries produced some 200 million tonnes of crude steel in 2008, according to figures from Worldsteel, making up for nearly 15 percent of the global crude steel output, which stands at 1.33 billion tonnes.
"Apparent consumption will drop by 29 percent year-on-year in the first quarter and by a further 23 percent in the second quarter," Eurofer said.
Global demand for steel has plummeted since the financial crisis ripped into the real economy with the automotive and construction industries badly hit by the worst economic downturn since World War Two.
"Particularly the automotive sector is badly affected by the recession, but also construction, steel tubes and the engineering sectors cannot escape a sharply downward trend," Eurofer said.
Steelmakers across the globe such as ArcelorMittal (ISPA.AS) and Russia's Severstal (CHMF.MM) have announced sharp output cuts since last September. For a factbox on output cutbacks by major steel companies
Eurofer expects some improvement in the market, once the destocking process comes to an end.
"Most sectors will see a mild improvement in 2010," Eurofer said