ArcelorMittal is no longer asking investors to wait for a European policy rescue. The Carbon Border Adjustment Mechanism, the import levy that puts a carbon cost on foreign steel, has been in force since January. The new tariff-rate quota, a country-by-country cap on duty-free imports, started at the beginning of July. Those two tools are why idled blast furnaces in Spain, Poland, and France are coming back. Group earnings before interest, tax, depreciation and amortization printed about $2.1 billion in the second quarter. That equates to $155 per tonne, well above older through-cycle averages. The debate is whether that per-tonne result is a new mid-cycle floor or a peak that already prices the trade reset.
The income statement improved faster than the cash account. Reported net income was $683 million, or $0.90 a share, even after a Vallourec stake-sale gain was cancelled by a Baffinland impairment. Net debt still rose to $9.5 billion as seasonal working capital and growth spending absorbed cash. Mining earnings fell as Liberia rain and Canadian port weather delayed shipments. The strongest counterargument is that headline Europe strength is still a price-cost story that has not yet been stress-tested by a full furnace restart or by a working-capital unwind that fails to reverse in the second half.
Management guides third-quarter European shipments as stable to slightly higher, the opposite of the usual summer fade. A $1.8 billion project book is still the medium-term earnings claim, spanning Calvert, India, Liberia, and electrical steels. Near $73 a share the equity already pays a premium to book and a mid-single-digit forward earnings multiple. The next stretch of quarters decides whether Europe can hold utilization without giving back the spread.