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ArcelorMittal Poland Temporarily Stopping Production at Warszawa

01/31/2013 - ArcelorMittal Warszawa announced that, on 29 January 2013, the Polish plant would temporarily idle its steel plant and rolling mill for 9 and 11 days respectively.

ArcelorMittal Warszawa announced that, on 29 January 2013, the Polish plant would temporarily idle its steel plant and rolling mill for 9 and 11 days respectively. The decision came as a result of the continued decline in orders for reinforcing bars, which constitute 40% of plant’s production capacity.
The Polish steel industry, including ArcelorMittal Warszawa, has been struggling with falling rebar orders for many months. This is primarily due to illegal trading practices in Poland and VAT frauds on rebars imported into Poland from neighboring countries, the company said. Domestic manufacturers in Poland are losing market share to fraudulent entities offering cheaper rebar produced from other countries: they are unlawfully benefitting since they fail to pay VAT on the products.
According to the Polish Steel Association (HIPH) and the Polish Union of Steel Distributors (PUDS) estimations, as much as 40% of the reinforcement steel sold on the Polish market may come from illegal sources. The trade organizations estimate that each year illegal practices related to the reinforcing bars have deprived the state treasury of several hundred million zlotys (PLN).
 “It is unfortunate that the Polish steel industry, despite all the modernization efforts and investments, is suffering as a result of these unfair trade practices,” commented Sanjay Samaddar, CEO of Business Division East, ArcelorMittal Flat Carbon Europe. “We are hoping that the issue will be addressed by the Polish government as soon as possible, and that actions will be taken to eradicate those proceedings.”