Publications

The German steel and metals sector remains resilient with a competitive edge. However, major structural challenges and downside risks have increased.

Benefits from domestic steel demand growth will be offset by limits to raise sales prices due to the global steel overcapacity and cheap imports.

The Italian steel distributor segment has a large number of relatively small companies, which are still affected by weak demand and pressure on margins.

Fierce competition, high energy costs and increased uncertainty due to the Brexit decision continue to weigh on the financial strength of many businesses.

Banks are less willing to provide loans to the steel sector, given the high default rate and the recent debt impairment from one big steel manufacturers.

The US sector´s revenue performance remains negatively affected by the lower cost of imported steel and decreasing demand from the oil/gas industry.

The steel sector remains severely impacted by the ongoing domestic economic downturn, high interest rates, inflation, and exchange rate volatility.

A high level of competition, overcapacity and persistent low prices continue to affect revenues and margins of smaller French steel/metals traders.

External risk factors for the Mexican steel industry remain the volatility of the currency exchange rate and the impact of international metals prices.

The Dutch steel and metals sector has benefitted from a rebound in the building sector, but at the same time demand from the energy sector has decreased.

The level of protracted payments in the steel sector is high due to fierce competition, persistent pressure on margins and risky trading conditions.

Payment Practices Barometer for the Americas (NAFTA and Brazil) shows that 93% of respondents reported late payment from B2B customers over the past year.

In line with the survey average, 91.4% of respondents in Brazil (95.0% in 2015) reported late payment of invoices from B2B customers over the last 12 months.

While the economy is expected to slow down after a robust 4.6% in 2015, the forecast GDP growth rates of 2.5% in 2016 and 2.7% in 2017 are still solid.

Hungary´s economic growth is expected to rebound in 2017, after a slowdown in 2016, but the high level of external debt remains a major weakness.

Despite further growth, Poland is susceptible to a potential end of the eurozone recovery. Adverse economic policies could dampen investor sentiment.

The economic contraction continues in 2016, as investments and private consumption contract further. Only in 2017 a very modest rebound is expected.

Political risks have sharply increased, which could result in economic repercussions. Higher credit risks in the corporate sector are a major issue.

Looking at Russia, Atradius finds that oil price hardly matters for country risk.

The sector benefits from a robust performance of the Czech economy, but producers dependent on energy/mining and power engineering face difficulties.