CHINA DRIVES CONTINUING GROWTH IN STAINLESS STEEL OUTPUT

Official figures for global crude stainless steel production in 2011 are estimated to have reached another all-time high total of 32.05 million tonnes, 3.1 percent above the previous record, set one year earlier. In the traditional stainless steel making regions, only the EU and South Korea exceeded the 2010 outturn. The United States, Japan and Taiwan all produced less than in the previous year. Production in other countries increased by 6 percent, including double-figure growth in Russia and Ukraine.

Chinese production, according to officially reported figures, climbed by 11.1 percent, to 12.5 million tonnes. However, it is believed that much stainless steel, particularly 200-series material, is made by companies who are not CISA members. This material is, therefore, not included in widely quoted statistics. This under-reporting may have amounted to as much as 2.5 million tonnes in 2011, or an additional 20 percent.

Worldwide stainless steel output is forecast to grow by 5.8 percent, year-on-year, in 2012, to give another new record total of 33.9 million tonnes. If Chinese unreported production continued at the same rate, the figure would be 36.6 million tonnes.

Stainless steel making in the EU picked up in the fourth quarter of 2011, to total an estimated 7.6 million tonnes, 1.4 percent more than in 2010. We forecast a further increase of 3.9 percent in 2012. However, this figure may be affected by possible capacity reductions arising from consolidation in the European stainless steel sector.

Annual production in the United States fell in 2011. There are now signs of increased economic and industrial activity in the US and a rise is forecast for 2012.

Japanese output slipped in 2011, inevitably affected by the earthquake and tsunami in March. A modest recovery is predicted this year.

Taiwan's producers appeared to suffer most from reduced demand in the region. Last year's output was substantially down on the 2010 figure. A minimal increase is foreseen for 2012.

Source: MEPS - Stainless Steel Review