Company: MT
Filing Date: 2025-03-10
Form Type: 20-F
Source: 0001243429-25-000017
Chunk: 167

Company: ArcelorMittal
Filing Date: 2025-03-10
Form: 20-F
Chunk 167
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, including external foreign currency debt risk in Turkey and Argentina . This has led the Turkish lira to depreciate significantly against the U.S. dollar, causing inflationary pressure to re- accelerate and forcing the central bank to increase interest rates to over 40%, causing a downturn in the economy and stagnating steel demand in 2024. Historically, demand dynamics in China have also substantially affected the global steel business, mainly due to significant changes in net steel exports. Continued weakness of Chinese steel demand, coupled with ample domestic supply has seen net Chinese finished flat steel exports increase from 3.4 million tonnes per month during 2022, to 5.2 million per month during 2023, 6.1 million tonnes per month during the first half of 2024 and reaching record highs of 6.6 million tonnes per month during the second half of 2024. In 2024, weak steel demand was seen in the continued decline in housing sales in China, reflecting low household confidence and with new housing starts continuing to fall during 2024. The short-term outlook for China remains largely dependent upon the timing and scale of the cyclical rebound in the real estate market, the negative impact of increased U.S. tariffs and the amount of government stimulus. While the expectation is that further government stimulus will support GDP growth in 2025, Chinese overcapacity and a need to export is expected to remain across most industries. Moreover, the Company continues to expect Chinese steel demand to decline in the medium-term, as infrastructure spending has been front-loaded and real estate demand is expected to weaken structurally due to lower levels of rural- urban migration. If the expected decline in demand does not coincide with renewed capacity closures, this could lead to steel exports from China remaining at or above current peak levels and have a negative impact on global steel prices and spreads. Unlike many commodities, steel is not completely fungible due to wide differences in its shape, chemical composition, quality, specifications and application, all of which affect sales prices. Accordingly, there is still limited exchange trading and uniform pricing of steel, whereas there is increased trading of steel raw materials, particularly iron ore. Commodity spot prices can vary, which causes sales prices from exports to fluctuate as a function of the worldwide balance of supply and demand at the time sales are made. ArcelorMittal’s sales are made based on shorter-term purchase orders as well as some longer-term contracts to certain industrial customers, particularly in the automotive industry. Steel price surcharges are often implemented on