The dust regarding tariff discussions is far from settled, so I’ve jotted down some thoughts on the current outlook.
From Aspo’s perspective, the escalation of the trade war is undoubtedly a bad thing, as tariffs would weaken the prospects of important industrial customers. Currently, SSAB’s share is particularly high (based on this release, about half of the volume), so a weakening of demand and competitiveness in the steel industry (for example, the shift of Chinese production from the United States to Europe) would thus be a negative factor for ESL’s transport volumes as well. ESL’s other customer base is also unlikely to emerge from this completely unscathed, so next year’s forecasts, in particular, are now subject to more uncertainty than before. There were no great expectations for the current year anyway, although these too could slip into a weaker position. However, the 2025 earnings improvement we forecast should come without market tailwinds.
There are, of course, no guarantees that the tariffs will come into force, and the best guess is probably that we will eventually end up somewhere between the original tariffs and zero tariffs. At the moment, however, uncertainty is exceptionally high, and the situation is evolving day by day, which makes assessing possible impacts particularly challenging.
From Telko’s perspective, tariffs also indirectly affect through the weakening of the macroeconomy (e.g., consumer confidence) and a decrease in demand from industrial customers. There is no direct export to the United States, but demand for end products would definitely suffer from an escalating trade war and a slowdown in economic activity. However, I do not see a dramatic impact on the long-term outlook for now, especially if the tariffs can be negotiated to levels lower than those currently announced.
The impact on Leipurini is, according to estimates, clearly the lowest of Aspo’s segments, as there are no exports to the United States and demand in the bakery market is relatively low-cyclical compared to industry. Leipurini does not benefit from this situation either, so it is difficult to come up with any positive angle for Aspo from the escalation of tariff disputes. On the positive side, however, there is nascent fiscal stimulus in Europe, which could increase activity in the EU internal market from next year onwards. I will return to the Q1 expectations with a preliminary comment, but it is good to note here that the aforementioned factors do not yet affect the early year figures.
As a note unrelated to macro news, Aspo also updated its financing by participating in a group bond loan guaranteed by Garantia. The amount could not be confirmed from the release, but it is 7.5–20 MEUR (likely at the upper limit). This practically replaced a previous similar instrument that matured during 2024. There is nothing particularly unusual about this, but at least the guarantor of the loan, Garantia, sees Aspo’s current debt level and credit risk as reasonable. The 3.7% coupon rate cannot yet be used to determine the cost of financing, as my understanding is that the guarantee fee is added on top of this.
