A Potential Hot Strip Mill at Pecém

Research evidence excerpt

A Potential Hot Strip Mill at Pecém

Update

July 7, 2026 08:23 AM GMT

Morgan Stanley & Co. International plc+MArcelorMittal SA | Europe Alain Gabriel, CFA

Equity Analyst

A Potential Hot Strip Mill at Alain.Gabriel@MorganStanley.comIoannis Masvoulas, CFA +44 20 7425-8959

Ioannis.Masvoulas@morganstanley.com +44 20 7425-0427

Pecém Adahna Ekoku

Adahna.Ekoku@morganstanley.com +44 20 7425-0578

What's new? A Metal Expert article stated that ArcelorMittal plans to install a hot

Ferdinand Huber

strip mill at its Pecém (ex-CSP) steelworks in Ceará, Brazil. According to the article Research Associate

the project has advanced beyond feasibility studies and carries an estimated capex Ferdinand.Huber@morganstanley.com +44 20 7677-2702

of BRL 4-5bn (US$0.74-0.92bn), although it remains subject to final engineering and ArcelorMittal SA (MT.AS, MT NA)

board approval. The mill would convert (likely part of) existing slab output into HRC Carbon Steel | Luxembourg

for the automotive, construction, appliances, and solar sectors while maintaining the Stock Rating Overweight

Industry View In-Line

site’s 3 Mtpa crude steel capacity. The company has not commented on this news.

Price target €54.30

Shr price, close (Jul 6, 2026) €56.96

For context, ArcelorMittal acquired the asset (Companhia Siderúrgica do Pecém or 52-Week Range €62.60-26.35

CSP) in March 2023 for an enterprise value of ~US$2.2bn. At the time of the Mkt cap, curr (mn) US$48,330

Net debt (12/26e) (mn)* US$8,204

acquisition, management had explicitly highlighted the long-term option to add EV, curr (mn)* US$69,911

rolling and finishing capacity alongside potential primary steelmaking expansions. * = GAAP or approximated based on GAAP

Implications for ArcelorMittal: Although ArcelorMittal has not yet formally