ArcelorMittal has increased its global production cut in the fourth quarter 2008 to 45% and plans to extend the cuts to the end of the first quarter 2009.
M. LN Mittal chairman & CEO told media that its capacity utilization will remain at 55% to 60% during January to March 2009. He also said that January and February is the bottom of the market and that he is optimistic for prospects in the second half of 2009.
The report also cited Mr Aditya Mittal CFO of ArcelorMittal as saying that "We swiftly reacted to the existing economic environment. We were able to bring down production faster than shipments, which means, we did not build inventories.”
ArcelorMittal reduced its steel shipments to 17.1 million t in the fourth quarter of 2008 from 25.6 million t in the third quarter of 2008 and 28 million t in the fourth quarter of 2007.
ArcelorMittal had previously said it would cut its global production by up to 35% in the fourth quarter and then review the need for further cuts.
ArcelorMittal estimates it will produce 12 million t less crude steel across its global operations in the first quarter of 2009, compared with the first quarters of 2008, 2007 and 2006 when levels were almost constant around 30 million t. ArcelorMittal forecast that its steel production would fall by 7%% to 15% in 2009. But Mr Mittal said that “It would take a further two and a half years before production at its steel plants reached the same levels before the global financial collapse in October.”