Russian steelmaker Severstal said on Friday it will cut output at its steel plants in October as a result of slower demand for steel products due to recent changes in global economic conditions.The company said in a statement that it will cut crude steel output at its Cherepovets plant in Russia by approximately 25 percent, and by some 30 percent at its U.S. and Italian plants.
The limbo-bar that steelmakers contemplate is their break-even cost. The price of $1,000/tonne of hot rolled steel in early '08 has fallen to $780, above the $650 figure believed to be most steelmakers' cost of production. Korea's Posco is preparing for the risk of a deep recession. Chinese representatives at a world conference opined that they'll be dropping 20% of their output. And the world's largest steelmaker, ArcelorMittal has already idled 15% of its capacity.