Under the shadow of tariffs, the steel industry is struggling to move forward. ArcelorMittal warns that a trade war will weaken demand.

The multinational steel and mining giant ArcelorMittal SA, headquartered in Luxembourg, released its performance report on Friday. The financial data shows that under the current global trade war situation, the aggressive tariff policies of the United States, as well as the support of domestic steel companies by European countries, are driving steel prices up. However, the steel giant warned in its financial report that the uncertainty of Trump's tariff policy and global trade expectations could have a huge impact on steel demand and the entire steel industry supply chain costs and profits. The world's largest non-Chinese steel manufacturer stated in its performance statement on Wednesday that the subdued demand brought about by global trade turmoil could result in steel demand falling below the strong revenue growth guidance given by the company's management earlier this year. The company stated in its statement on Wednesday that these combined adverse factors could result in steel demand falling below the optimistic expectations of the company's management earlier this year. Previously, at the February earnings conference, as the largest steel producer in the Western world, ArcelorMittal's management had forecast global steel consumption, excluding the Chinese market, to grow by 2.5% to 3.5% driven by customer restocking. In February, the US President Donald Trump's administration, back in the White House, expanded the 25% steel import tariffs from previously exempted countries worldwide, including Canada and Mexico - both major steel suppliers to the US. Meanwhile, Europe also strengthened its trade protectionist measures, not only to address the global tariff war initiated by Trump, but also to cope with the continuous downward pressure on prices caused by the large supply of cheap steel from Asian markets in recent years. "Looking ahead, caution is indeed needed for the short-term outlook," said ArcelorMittal's CEO Aditya Mittal in the statement. "If the uncertainty of global trade terms cannot be quickly resolved, it will damage the business confidence in the global market and may further disrupt the global economy." It is still unclear whether the continuously escalating new round of global trade wars will bring long-term benefits or drawbacks to the steel industry. However, according to the information revealed in ArcelorMittal's financial report, it may at least temporarily cool down global steel demand. ArcelorMittal, a multinational steel and mining giant, with core businesses of flat products, long products, tubes, and own iron ore, and the second-largest crude steel producer globally, has significant technological advantages in high-strength steel for automobiles, electrical steel, and engineering construction steel plates. It holds the leading position in the automotive steel market globally, supplying advanced high-strength steel and non-oriented silicon steel for electric cars to main OEMs such as Toyota, GM, Volkswagen, and Stellantis. It also has a leading position in H-beams, rails, and rebar for concrete in North America and Europe, with nearly 14 large-scale production lines. Earlier this month, the EU announced a 90-day delay in implementing retaliatory measures against the steel and aluminum tariffs initiated by the US government. However, it warned that if satisfactory results are not achieved in the tariff and bilateral trade negotiations between the US and the EU, the measures will automatically take effect. Thanks to the unexpectedly strong performance of the iron ore mining business, the overall profitability of the steel giant based in Luxembourg slightly exceeded analysts' general expectations in the first quarter. The company's first-quarter Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) reached $15.8 billion, higher than the approximately $15.6 billion expected by analysts. The Trump administration has decided to impose a stunning 145% tariff on China, one of the top three trading partners of the US, and at least a 10% tariff on most other countries. Many forecasters have warned that the global economy will sharply slow down in the future, and some even predict a severe economic recession in the US and possibly globally this year. This is partly due to the fact that since the period of high inflation in 2022, US households facing continued inflation pressures may see a significant decline in demand, with some households having limited savings, while household demand or consumption accounts for about two-thirds of the US Gross Domestic Product. Although the Trump administration earlier this month imposed a 90-day deferral on some of the most severe "reciprocal tariffs", during which time the standard tariffs for most countries other than China were adjusted to 10%, according to Bloomberg Economics research team forecasts, the current "effective tariff rate" in the US is close to 23% - the highest level in over a century, which has already had a severe impact on US consumer and business confidence.