n° 167 – July 2020

The desire for a recovery combined with great uncertainty: these are the dominant sentiments of Italian non-ferrous metals operators. LME copper is flying but there is a lack of sales in the real market and tensions are constantly increasing. 

Italian companies recorded losses of more than Euro 280 billion in the first half of 2020, with the north east suffering the most (-21.3%); in April alone, the loss of turnover was calculated at Euro 93 billion (-39.1%).

According to the market data, foundries are gradually recovering but comparisons with 2019 remain stark: in Italy, the sector’s industrial production index showed growth of around 91% in May when compared to April, but it is not possible to speak of a recovery. The rebound curve was expected for Italian foundries given that the operations of more than 80% of them were interrupted in April, but production remains significantly lower than in 2019.

The coming months promise to be full of uncertainty, with order portfolios offering only very short-term visibility. It is to be hoped that investment and industrial policy plans will accelerate sharply; it is necessary to define immediately a plan to streamline bureaucracy and encourage long-term business efforts, especially in innovation and sustainability. The government is ready to extend the state’s “shock absorbers” for an additional 18 weeks in order to support companies, but the real risk for many businesses remains the extreme shortage of liquidity between now and the end of the year. The automotive sector will certainly offer little cheer as the global car market is expected to contract by around 17% in 2020 and the figure is thought likely to be even worse for commercial vehicles.