ArcelorMittal has predicted that 2011 will be a better year for steelmakers than 2010, despite posting a loss in the most recent quarter.
The world’s largest steelmaker made a net loss of $780M in the last three months of 2010, compared with a $1.35bn profit a year earlier. Increasing prices for key raw materials such as iron ore and coking coal have hurt the company’s bottom line.
But it said steel prices were adjusting to the rises in raw material prices. It also said production volumes were expected to increase in the first quarter of 2011 as “the gradual underlying demand recovery continues and market sentiment improves”.
“Although 2010 continued to be a challenging year, as anticipated we saw a slow and progressive recovery,” said Chief Executive Lakshmi Mittal.
“The gradual underlying demand recovery continues and we expect 2011 to be stronger than 2010.”
Crude steel production for Q4 was 21.6Mt compared to 22.2Mt for Q3. For the full year, production was 90.6Mt compared to 71.6Mt in 2009.
In a drive to increase self-sufficiency in its raw-materials needs, it continues to aim for 100Mt of its own iron-ore production by 2015, excluding output from recently-acquired group Baffinland. Arcelor’s iron-ore output rose 30% in 2011 to 48.9Mt while coal production fell 1.4% to 7Mt.
Arcelor said Q4 earnings before interest, taxes, depreciation and amortization fell to $1.9bn from $2.13bn a year earlier, and below $2.2bn posted in Q3. It forecasts Q1 2011 Ebitda of between $2bn and $2.5bn. Q4 steel shipments rose to 21.1Mt from 19.5Mt a year earlier.