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

Company: ArcelorMittal
Filing Date: 2025-03-10
Form: 20-F
Chunk 20
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economic fluctuations in the global economy which are impacted by many factors ranging from trade and geopolitical tensions to global and regional monetary policy to specific disruptive events such as pandemics, wars and natural disasters. Prior recessions have generally resulted in lower steel demand and steel prices, with consequential material adverse impacts on steel companies’ results. Significant declines in steel prices have resulted, and may in the future result, in inventory- related charges. In addition, the impact of lower steel prices on ArcelorMittal’s results is subject to a lag effect (due to its contracts), and therefore the impact is felt beyond the duration of any decline in spot steel prices. In the past, substantial price decreases during periods of economic weakness have not always been offset by commensurate price increases during periods of economic strength. Market prices for iron ore are also affected by supply and demand conditions. Excess iron ore supply relative to demand has led to depressed prices at various points in recent years and could recur, with potentially a corollary effect on steel prices. No assurance can be given that iron ore prices will not decline further, particularly if there is a recession, Chinese steel demand declines, worldwide capacity increases due to new mines coming online or steel demand declines again due, for example, to the negative effects from the continuing Russia- Ukraine and Middle East conflicts, or other regional conflicts, in particular on energy supply and prices. The steel industry suffers from structural overcapacity globally, especially for long products. This overcapacity is affected by global macroeconomic trends and amplified during periods of global or regional economic weakness, leading to weaker global or regional demand, increased exports and/or decreased regional or global prices. In particular, China is both the largest global steel consumer and the largest global steel producer by a large margin. At various points in the past and since the second quarter of 2024, weaker Chinese steel demand has not been fully offset by reduced Chinese steel production (due to large price gaps compared to markets outside China), which has led to a flood of Chinese steel exports into various regional markets, including the Company’s principal markets, weighing on demand and indeed depressing market prices. If this trend persists, it will likely lead to rising inventory levels in steel markets outside of China and continued downward pressure on prices and spreads, negatively affecting the Company’s profitability. Exports by steel producers in other developing countries and regions (such as the CIS, Turkey and India) into the Company’s principal markets are also a market feature. The extent of these exports depends on the demand/production balance in the producer’s