Apparent steel consumption fell by 7.7% year-on-year in the second quarter of 2019, after a drop of 1.6% in the first quarter. The negative trend in steel demand is the result of the ongoing slump in EU’s manufacturing sector due to weakened exports and investment that has become more pronounced during the second quarter of this year. Leading indicators forecast a continuation of the downturn for the remainder of the year, with no rebound before the second quarter of 2020.

The current downslide of the manufacturing sector in the EU is not likely to bottom out soon: escalating trade wars between the US and several of its main trading partners and persistent uncertainty regarding Brexit have the potential to severely impact global trade conditions, lead to a further deterioration in business sentiment and curb investment growth. In this scenario, the EU steel sector would be severely impacted, also having to cope with growing import distortions as well as higher volatility as a result of the increase of safeguard measures’ quota both this year and next.