In February, Argentina's metallurgical production fell by 10.3% year-on-year and by 1.9% compared to January. Thus, a contraction of 8.2% was accumulated in the bimestre, according to the monthly report by the Argentine Metallurgical Industrialists Association (ADIMRA). The capacity utilization rate stood at 40.2%, the lowest level in the last four years. The largest declines were recorded in the following sectors: Foundries: -15.0%, Capital Goods: -14.6%, Auto Parts: -12.0%, Medical Equipment: -11.6%, and Electrical Equipment: -10.2%.
Geographically, the situation was also negative. The leading provinces in terms of decline were Buenos Aires (-12.9%), Córdoba (-11.9%), Mendoza (-10.2%), Entre Ríos (-9.8%), and Santa Fe (-4.3%). The president of ADIMRA, Elio Del Re, warned about the severity of the current scenario: “The metallurgical activity deepens its negative trend during the first bimester of the year, with critical levels of idle capacity and with no clear signs of recovery in the short term.”
He also pointed out that the decrease in local consumption directly affects profitability: “The strong contraction of the domestic market is directly impacting production and deteriorating the profitability of many sector companies.” This situation is putting pressure on the sustainability of metallurgical employment.
Regarding the labor market, the level of employment in the sector recorded a year-on-year decrease of 1.8%. This figure represents a contraction of 8 percentage points compared to the same month of the previous year. The negative trend deepened at the beginning of the year due to the lack of signals of recovery in the short term and the contraction of the domestic market, ADIMRA stated.
