Italian producers want to resume production even if the coronavirus emergency is still in place. As reported previously, the prefect of Taranto, where ArcelorMittal Italia is running the former Ilva plant, decided that only the production activity "for commercial purposes" would be suspended until April 3. This week, Italian prime minister Giuseppe Conte said that the lockdown that has been in place since early March will be extended until April 13. Lucia Morselli, managing director of ArcelorMittal Italia, wrote to the prime minister stating that, in the event that the order of the prefect of Taranto prohibiting production for commercial purposes "should be extended, we will be forced to take into consideration all the measures to safeguard our company." Morselli did not exclude "the start of standby operations for the entire hot area of the plant" nor temporary layoffs "for all the workforce that is not necessary to carry out such operations". The prefectural decree expires today, April 3. "While continuing to bear all the costs for Ilva, we have not made any revenue from the sale of what has been produced," Morselli underlined.
In the meantime, the management of the ThyssenKrupp Acciai Speciali Terni (TK-AST), based in Terni, is also pushing for the resumption of activities. The steel mill "is the only Italian producer of rolled stainless steel and therefore is among the strategic companies," said CEO Massimiliano Burelli. "We also have production for essential and medical-type supply chains," he stressed. In the afternoon of April 2, the company met with local trade union organizations communicating to them their will to resume production activity. During the meeting, Mr. Burelli said he wanted to ask the prefect of Terni to be able to produce by way of derogation from the government decree. TK-AST in recent days has carried out initiatives to make the departments of the plant safe, has purchased 50,000 masks and installed a system of cameras for monitoring body temperature near its entrances.
Meanwhile, Antonio Banzato, president of the Italian steel producers association Federacciai, reiterated that stopping the Italian steel industry is a mistake. "All our competitors and even the companies controlled by us Italians are open abroad," said Banzato. According to him, the restart could take place in the second half of April. "We cannot hold out any longer," Banzato said. Speaking about the impact of the lockdown on steel production, the Federacciai president said that, giving a month up for lost and not knowing what the restart will be like, in 2020 a 10 percent drop in production can be expected currently. However, "there are so many variables in the aftermath" that it is difficult to make estimates, he noted.
The Italian National Institute of Statistics (Istat) has estimated an industrial production decrease of 16.6% in March compared to February. If confirmed, this would be the largest monthly decline since the industrial production data has been available (1960). Istat said, "The containment and contrast measures introduced to limit the spread of Covid-19 have caused a double negative shock: on the demand side, with the postponement of consumer spending decisions, the closure of numerous commercial activities and the elimination of tourist flows; and, on the supply side, with the blocking of numerous production activities". This combination of factors has determined "the worst possible scenario, making the Italian economy screw into a recession that will be deep, the duration of which will depend on how much time will be needed to exit the emergency".