ArcelorMittal now expects global apparent steel consumption to contract by up to 1% on-year in 2022, given the Ukraine war impact and rising inflation in Europe, down from the previous forecast of 1% growth.

The group's steel shipments fell 7% on-year in the first quarter to 15.3 million tonnes, and also inched down on-quarter, impacted by the Ukraine war. Crude steel output also dropped 7% on-year and was fractionally down on-quarter to 16.3mt, Kallanish notes.

Revenue however grew 35% on-year in Q1 to $21.8 billion, supported by higher average steel and iron ore selling prices, and net income attributable to equity holders of the parent jumped 80% to $4.1 billion. Ebitda surged 57% to $5.08 billion.

Income from associates, joint ventures and other investments in Q1 was $559 million as compared to $383m in Q4 2021 and $453m in Q1 2021.

Non-automotive demand continues to recover, while supply chain effects have continued to impact the automotive sector, ArcelorMittal says. Key risks going forward are the Ukraine war; impact of higher energy prices on economic activity and consumer confidence, particularly in the EU; and Covid-19 implications for China’s economy and extent of stimulus support.

ArcelorMittal has gradually restarted its Ukrainian operations since April and is currently operating one of three blast furnaces, BF no.6, to produce low tonnages of pig iron. Iron ore production is meanwhile currently running at about 50-60% capacity.

The firm has temporarily suspended its 5m t/year capacity Ukrainian iron ore pellet plant project, initially scheduled for completion by end-2023. Revised completion date and budget will depend on when the project can be effectively resumed amid Russia’s invasion of Ukraine, ArcelorMittal observes.