Record Global Stainless Steel Production, but Mixed Market Message from Mills
Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)–Although world stainless steel production is set to break records in 2012 and 2013, the profile of the key industrial metal as an indicator of industrial and economic health is unclear in the current market conditions.
Total world crude stainless steel production for 2012 looks set to reach an all-time record figure of 34 million tons, which would represent a 0.8% increase on the previous high, which was set in 2011. Steel industry consultant MEPS (Sheffield, England) anticipates moderate global growth year-over-year of about 3% in 2013, which would result in an annual production of 35 million tons.
With economic and industrial growth in China having slowed significantly, it is estimated that the published figure for Chinese crude stainless steel production will increase 1.1% in 2012 to reach a total of 14.3 million tons, which is well below the typical rate of expansion recorded by China in recent years.
In order to support prices, South Korea’s major stainless steel mill continued to limit production during the third quarter of 2012. But total output is expected to increase 0.7% year-over-year, even with the curb on production.
Poor demand and oversupply led to further cuts in production in Taiwan in 2012, with production falling 8.6% year-over-year. Japanese consumption is stable, but exports are weak due to ongoing economic problems, especially in Europe. Crude stainless steel output for 2012 is forecast to fall by 1.1% year-over-year.
Although activity levels in the U.S. have been steady since the second quarter of 2011, the total output for 2012 is predicted to decrease 1.6% compared to 2011.
After promising results in the first quarter of this year, demand has dropped in the European Union. A marginal growth of 0.3% year-over-year will see an annual production of 7.6 million tons.