The turning point of the new crown epidemic: steel mills and foundries in Eastern Europe resume operations

The steel and metal industries in Europe have rebounded from the downturn in early spring. The main metal-consuming industries (automotive, construction and other industries) that were previously discontinued due to the new crown epidemic are also at the starting point of recovery. All major car manufacturers in the European Union have ceased production. As a result, steel producers and most foundries in the Czech Republic, Hungary, Poland and Slovenia (the main metallurgical center of Central Europe) have seen their steel rolling demand drop significantly.

The iron and steel industry in Eastern Europe plays an important role in the European metallurgical structure. According to data from the World Steel Association, they account for 12% (about 16 million tons) of total carbon steel production in the EU 27 economic zone. Central European steel producers and steel foundries have been tightly integrated into the production chains of Germany, Italy, Austria and France. The sudden drop in demand and the forced closure of quarantine production across Western Europe caused the industry to severely hit the metal sector in Central Europe. In the first quarter, steel production in the region fell by 13%, while overall production in the EU27 region fell by 11%.

The most influential countries are Poland and Hungary. Throughout the first quarter, steel production fell by 19% and 18%, respectively. The decline in Poland is mainly due to the local producers' focus on the production of flat rolled products for automobile manufacturing. On the other hand, Hungarian foundries' demand for auto parts that they rely heavily on has weakened. As a result, the suspension of German car production in mid-April led to the closure of foundries in Poland and Hungary.