One of the industries under severe strain from Trump's tariffs is the steel and aluminium industry. Europe’s top steelmakers delivered better-than-expected first-quarter results, but the optimism is clouded by what's to come. Major players are flagging significant risks to 2025 demand due to global trade tensions, particularly in the US and China.

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Swedish steelmakers echoed these concerns, noting that while proximity to customers and specialised products cushioned initial tariff shocks, the Outlook remains “more uncertain than usual.”

Trade tensions rattle steel demand

Aperam, which beat estimates on the back of higher European volumes and its US business consolidation, also warned that pricing pressure will continue to weigh on earnings. The broader European steel sector remains under strain from high energy costs, weak local prices, and growing competition from cheap Chinese exports.

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The OECD reports that global steel overcapacity is rising, driven by cross-border investments by Chinese firms, adding further pressure on margins across key markets. China has long been under scrutiny for dumping cheap goods and relying on aggressive trade tactics amid declining domestic demand.

While ArcelorMittal sees continued strength in India, buoyed by a new 12 per cent safeguard duty on Chinese imports, it expects persistently weak spreads in China due to oversupply.

In Europe, a rebound in spreads is supported by the EU’s steel and metals action plan and expected infrastructure-led demand in Germany. Still, companies admit it is difficult to provide a reliable full-year outlook amid ongoing market volatility.

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(With inputs from the agencies)