The steel market is a sub-segment of the metalwork market, which consists of steel producers, that create the material from an alloy of iron ore and coal ore. This is an industry that has historically been rather large for France, steel being an essential material for the construction of building structures, for example.
The steel market is an internationalized market in which the main companies are Arcelor Mittal and Chinese or American competition. France can rely on the world leader, which is nevertheless strongly challenged by players from emerging countries who are producing significant volumes.
Competition is global, and the entire sector is subject to over- and under-production due to price quotations on a financial market. Market entry barriers are very high and explain the absence of new entrants.
In this type of extremely capital-intensive market, there is a need to produce substantial volumes to make production tools profitable. As a result, mergers are frequent and often significant in the sector, such as the merger between Arcelor and Mittal.
The main supporter of the steel market is industrial work. Therefore, the market is directly dependent on the economic situation and the investments made by industrial firms. For example, in China, steel consumption is 450 kilos per capita while in France it is only 220 kilos (source: figaro).
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