September 07, 2008

Mr Schorsch outlines optimistic outlook for steel in US

Mr Louis Schorsch president & CEO of ArcelorMittal North America said that his company plans to grow 20% by 2012 as the demand for steel continues in the world's emerging economies.

Mr Schorsch during a keynote speech at the CRU North American Steel Conference said that "Our market is driven by what's happening on the other side of the world. United States formerly drove the world economy, but it will never be that way again. The fundamentals have fundamentally changed.”

But Mr Schorsch said that he is bullish about the global steel market because of the growing demand from developing economies of Brazil, China, India and Russia that started at the beginning of the century and continues unabated. He added that "There's no prospect for a global slowdown. Emerging markets will drive global growth."

Mr Schorsch also noted that steel industry consolidation has added the potential for stability in the market. Mr Schorsch said that "It gives us flexibility as a large company pointing to ArcelorMittal's 25% to 30% of market share, which he contends gives it better capacity utilization, economies of scale, market influence and the ability to produce at the correct level for market conditions.”

Mr Schorsch predicted that “US steel market will pick up from its current level because steel service center inventories are at a three month level, original equipment manufacturer inventory levels are reasonable, the underlying domestic market demand is relatively stable, and the prices of metallics and iron ore have sharply risen, putting pressure on global price levels.”