The outlook for Italy's metals sector is far from encouraging, as a combination of cheap Chinese imports, low domestic demand and few project expansions mean that growth in consumption and production will be sluggish over the period to 2018. However, we expect Italy to retain its position as the EU's second largest steelmaking country, with a 16% share of production and the status of a new producer. In 2014, we are forecasting steel production in Italy to reach 27.06mn tonnes (mnt), representing an increase of 1.5% year-on-year (y-o-y). Similarly, we are forecasting steel consumption in Italy to rise by 1.4% y-o-y in 2014 to 22.53mnt.

BMI Industry View 7

SWOT 10

Metals SWOT 10

Industry Forecast 12

Steel: Few Positive Signs As Production Flatlines 12

Production: Plethora Of Issues To Deter Growth 13

Some Respite For Margins 14

Consumption: Muted Growth As Economy Flatlines 15

      Table: Steel Production & Consumption (Italy 2010-2018) 16

      Table: Steel Industry Historical Data (Italy 2005-2012) 16

Commodities Forecast 18

Steel Price Forecast 18

      Table: BMI Steel Forecast 18

Short-Term Outlook 18

Core View 19

Global Steel Glut To Persist 19

Production: Rationalisation In The Long Term 20

Consumption: Growth Decelerating 22

Excessive Chinese Exports 23

Growing Arbitrage Between East & West 24

Risks To Price Outlook 24

      Table: Steel Data & Forecasts 25

      Table: Global Steel Prices By Region & Product, US$/tonne (ave) 25

Monthly Metals Update 26

Iron Ore: Chinese Stimulus Not A Game Changer 27

Steel: Gradual Rationalisation Insufficient To Boost Prices 29

Aluminium: Recent Rally Unlikely To Persist Into H214 30

Copper: Bearish Forecast Appears Well Placed 31

Lead: Picking Up Autos Sector Tailwinds 32

Nickel: Recent Rise To Fall Back In H214 33

Zinc: Potential Test Of Resistance In Coming Weeks 35

      Table: Select Commodities - Performance & BMI Forecasts 37

Competitive Landscape 38

      Table: Europe - Largest Listed Metals Producers 39

Company Profile 41

Alcoa 41

Recent Financial Data 44

      Table: Alcoa - Key Financial Data 45

Methodology 46

Cross Checks 46

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