Dow Jones quoted Mr Aditya Mittal CFO of ArcelorMittal as saying that raising steel prices remains difficult despite higher steelmaking costs, due to a still slow recovery in real demand.
He added that "Real demand continues to grow but at a slow pace; due to the uncertainty over the 2011 economic picture, apparent market conditions are tough which makes it a challenge to raise prices despite higher costs running through the business. Our raw material costs in the first quarter 2011 will be broadly similar to fourth quarter 2010 levels."
Mr Mittal said that inventories remain low, however, so when steel demand recovers that will be positive for spot prices.
Steel producers in the developed world are operating between 65% and 70% of capacity. ArcelorMittal forecasts global demand for steel to grow 6% in 2011.
It may be noted that ArcelorMittal has idled 3 additional blast furnaces in Europe this quarter and said earlier this week that steel capacity will exceed demand in the region for the next 12 to 18 months.