STEEL OUTPUT WILL RISE BY MORE THAN 5 PERCENT IN 2007
MEPS - Global Crude Steel Production
Estimate ( tonnes)
MEPS - World Steel
World crude steel production will show an
increase of almost 10 percent in 2006 year on year. In 2007 a
further 5.4 percent growth rate is anticipated. The past seven years
of this millennium have been the most productive in the history of
the steel industry - rising by more than 450 million tonnes over the
period. This equates to 57 percent growth in output over the figure
recorded in 1999.
MEPS is now forecasting world wide crude
steel making in 2007 at in excess of 1.3 billion tonnes (1307
million tonnes). The oxygen/blast furnace process will continue to
lift its share of manufacturing - rising by 11 percent in 2006 and
almost 7 percent in 2007 to 873 and 932.5 million tonnes,
respectively. We predict substantial growth in the supply of direct
reduced iron in 2007 as demand continues to expand.
In 2006, most steel producing nations
benefitted from the surge in consumption. Those in Asia, however,
took the lionís share, with 75 percent of the increase. This
figure is expected to rise to around 90 percent in 2007.
Steel output in the EU-25 will be reported
at approaching 198 million tonnes for 2006. This represents an
increase of almost 6 percent, year on year. A strong revival in the
construction segment, coupled with an inventory building phase by
steel users gave the mills opportunities to lift steel
manufacturing. A number of blast furnace outtages in that twelve
month period kept the growth in production from the process to more
modest levels (2.8 percent).
Crude steel output in the remainder of
Western Europe, excluding the EU, is expected to show a 3.6 million
tonne growth (11 percent) in 2006 versus the previous year. Both
export and domestic demand have been extremely firm in Turkey.
Furthermore, new capacity installations have enabled the steel
sector to push up output by well in excess of 10 percent.
Substantial increases in output have also been put in place with
revived steelmaking in Serbia and Montenegro.
The outturn for crude steel production in
the former USSR in 2006 will turn out to be close to 120 million
tonnes - up 6.7 million tonnes (6 percent), year on year. Russia
will account for a substantial proportion of the growth, with near
to 4.7 million tonnes. The other main contributor will be Ukraine
with around 2 million tonnes. Russian local demand has been strong -
driven partly by the energy sector. Exports to Asia and the Middle
East have also helped lift supply from both Russia and Ukraine.
Crude steel production in the NAFTA region
in 2006 will turn out to be approximately 6 million tonnes up on the
figure returned in the previous year. Domestic consumption was
extremely firm during the first half. However, oversupply developed
in the final six month period as import volumes rose and panic
buying, from domestic mills earlier in the year, created excesses in
the final two quarters. In 2007, a modest turnaround is predicted
and total output is likely to be lower as the inventory drawdown
extends into the first half of the year.
South American steel output in 2006 will be
slightly higher than the outturn in the prior year. Local demand has
been firm across most of the region - Brazil in particular. The
gains would have been much higher but for a major plant breakdown in
the first half of the year. We forecast substantial growth in steel
production during 2007, amounting to approximately 3 million tonnes
as consumption continues to grow and new capacity comes on stream.
Africa is the only region in the world
likely to record a lower steel production in 2006. This is the
result of a significant fall in demand and supply in Egypt. In the
following year crude steel output is forecast to expand across most
of the area as local requirements pick up.
Consumption of steel in the Middle East
through 2006 went up dramatically compared to the year earlier
figure. However, local supply expanded only modestly. This was due,
in part, to serious plant breakdowns. Substantial growth in
steelmaking is predicted for 2007 as demand remains high.
Asian crude steel output in 2006 is
expected to be reported at near 667 million tonnes - up by almost 84
million tonnes (14.3 percent) on the year earlier figure. Chinese
steelmakers were the main contributors to this substantial gain.
Further, but more modest growth is anticipated in 2007 - led once
again by China.
No major steel output growth is anticipated
in Oceania when the 2006 results are reported. Small gains are
expected in 2007.
Source: MEPS - World
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