BRUSSELS - ArcelorMittal underlined the problems facing the European steel industry when it cut production for the second time this month, blaming weak demand and high imports.
Shares in the company, the world's largest steelmaker, fell 6% to touch their lowest point since July 2016 and were down 3.7% by 0930 GMT on Wednesday. They have lost around a quarter of their value in the year to date.
The cuts come after British Steel collapsed into liquidation last week, putting 25,000 jobs at risk unless it finds a buyer.
The European Commission is currently reviewing its "safeguard" measures to limit incoming steel and prevent a surge of imports as a result of increased tariffs effectively closing the U.S. market.
ArcelorMittal said its latest cuts amounted to annualised output of 1-1.5 million tonnes. It follows cuts equivalent to annualised production of 3 million tonnes announced on May 6.
Broker Jefferies said ArcelorMittal was taking the lead, as the largest steelmaker in Europe, which was necessary in the medium-term.
It added that the large market for hot-rolled coil steel appeared to have bottomed out, with other European mills cutting output to allow price rises. Such steel, heat processed into metal sheets, is used for car bodies and household appliances.
The company led by Lakshmi Mittal said it would reduce primary steel production at its facilities in Dunkirk, France and Eisenhuettenstadt, Germany.
It would also cut steel output at its plant in Bremen, Germany, in the fourth quarter of the year, extending a planned blast furnace stoppage for repairs, and extend a similar scheduled stoppage in the final quarter in Asturias, Spain.
ArcelorMittal temporarily idled production at its facility in Krakow, Poland at the start of May when it also reduced output in Asturias, and slowed down a planned increase of shipments from Italy.
Geert van Poelvoorde, the head of the flat products division of ArcelorMittal in Europe, said the production cuts would be reversed when market conditions improve.
The company cut its forecast for demand in Europe in May, predicting a contraction due to weak manufacturing and declining automotive production, for which steel is a major input.
ArcelorMittal has steelmaking plants in 18 countries worldwide, with 47 percent of its steel produced in Europe.