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ArcelorMittal reduces its steel demand forecasts following a slight Q2 beating

ArcelorMittal reported a quarterly core profit that was slightly higher than the market's expectations, but it lowered its steel demand forecasts due to U.S. president Donald Trump's new tariffs.

In March, the Trump administration implemented its first trade measure with a tariff of 25% on steel and aluminum imports. In June, it doubled that rate to 50%.

The Luxembourg-based firm's earnings before taxes, depreciation, and amortization (EBITDA), which are provided by the company, were $1.86bn in the second quarter. This was just slightly above the analysts' consensus estimate, $1.85bn.

It said that the quarterly results were aided by a price-cost positive effect in Europe where increased selling prices exceeded increases in input costs, as well as a greater contribution from India.

ArcelorMittal, however, cut its forecast for the global steel demand outside China. The company cited weaker U.S. consumer spending and trade disruptions.

The company expects global steel demand to grow by 1.5% to 2,5% this year, excluding China. China is the top consumer and producer in the world. This compares to the February forecast of 2.5% - 3.5%.

ArcelorMittal stated that tariff concerns and a subdued economy had dampened the demand in the U.S. where apparent steel consumption is expected to remain unchanged or even decline by as much as 2% in 2025. It had forecast growth between 1% and 3%.

The company said that the European steel demand is holding up better than other regions. However, it has lowered its forecast for 2025 apparent growth in steel consumption to a range between -0.5% to +1.5% from an earlier range of 0% - 2%. It said that the revision was due to limited tariff effects and lower interest rates. Reporting by Anna Peverieri, Gdansk; editing by Milla Nissi-Prussak

(source: Reuters)