RECORD HIGH GLOBAL STEEL PRODUCTION IN 2010 DESPITE SECOND HALF WEAKNESS

MEPS forecasts world crude steel production, this year, at 1.4 billion tonnes. This represents an increase of 14.4 percent over the outturn in the previous twelve months. Rising economic activity into 2011 should result in further, more modest, steel manufacturing gains, in excess of 4 percent, next year.

Global steel output in the second trimester of this year was approaching 6 million tonnes above the figure in the corresponding period of 2008 – making it a record quarterly tonnage. The July/September outturn will be approximately 3 million tonnes higher than that recorded two years earlier. The next “all-time” peak three-monthly value is expected in quarter two, 2011.

Industrialised nations will display a considerable recovery in crude steel output this year, following the recession-fuelled downturn of 2009. However, many of these countries will not reach the peak levels achieved in 2007/8.

China will continue to play the leading role in the growth in crude steel production across the globe. However, the remaining three BRIC countries – Brazil, Russia and India – will contribute over 18 million tonnes to the advancement this year, compared to the prior twelve months.

Steelmaking in the EU-27 region is forecast at 170 million tonnes this year. The 2010 outturn will be over 30 million tonnes (22.4 percent) up on the 2009 figure. Production in the latter six months of this year will decline, in comparison to the first half, as mills cut supply in an attempt to shore up prices.

Crude steel manufacturing in non-EU Europe is expected to reach 32 million tonnes in 2010. This represents an increase of 10 percent over the previous year’s outturn. Steel output in the CIS region is predicted to reach almost 105 million tonnes in 2010. This equates to a year-on-year increase of 7.6 percent.

In North America, steel production will bounce back strongly this year after the market was badly hit in 2009. A figure of 111.5 million tonnes is forecast in 2010 – equivalent to a 35 percent year-on-year hike. South American crude steel output is forecast to escalate by 5.5 million tonnes in 2010, year-on-year, to a figure of 43.6 million tonnes. Further strong growth is envisaged in 2011.

Total steel manufacturing in Africa will climb to near 17 million tonnes. This is equivalent to a year-on-year growth rate of over 11 percent. Steelmaking in the Middle East in 2010 is estimated at approaching 20.5 million tonnes. Local supply is likely to rise by 1.6 million tonnes in 2011 as demand for steel products remains buoyant.

Asian steel manufacturing is forecast to expand by over 90 million tonnes in 2010 to a figure of 892 million tonnes. This equates to a rise of approximately 12 percent. An increase of 40 million tonnes is projected for 2011, year-on-year.
 

Source: MEPS - World Steel Outlook Quarter 3 2010