Steel industry news and business information website.

sotn
This website is owned and operated by UK-based Metals Consulting International Ltd.
Our main business activity is steel industry capital investment appraisal.

STEEL NEWS REPORTS

CORPORATE NEWS


steelworker

Bimha admits revenue lost as tones of scrap metal looted
Fri 17th Feb 2017 11:30 GMT
Research show steel was, as of 15 February 2017 ways that Bimha was exploring to assist government meet pension and salaries arrears for ZISCO employees. Finance minister Patrick Chinamasa had promised to allocate some money but it has remained [see article]

Shanghai steel has best week in five on supply fears ...
Thu 16th Feb 2017 23:33 GMT
Traders are building stocks of steel products on expectations of reduced supply after the Chinese government, in efforts to control smog, told mills in the Beijing-Tangshan-Hebei region to limit their utilisation capacity to 50 percent if air quality [see article]

Anti-pollution efforts focus on 'smog routes'
Thu 16th Feb 2017 17:09 GMT
In addition, the ministry also limited or halted industrial production and processing of iron and steel and ordered cities to coordinate Shijiazhuang and Baoding in Hebei province, Jinan and Dezhou in Shandong province, and Zhengzhou in Henan province [see article]

RAW MATERIAL NEWS


Brazil's crude steel output up 13% in January
Fri 17th Feb 2017 06:53 GMT
Crude steel output in Brazil increased by 13.30% year-on-year in January, according to figures released by national steel association Ao Brasil on Friday February 17. Production came to 2.83 million tonnes, compared with 2.50 million tonnes a year before [see article]

ChelPipe Group sold over 1.7 million tons of pipes
Fri 17th Feb 2017 00:00 GMT
In 2016, Chelyabinsk Pipe-Rolling and Pervouralsk New Pipe Plants - the pipe division of ChelPipe Group - shipped 1.713 million tons of pipes to consumers, which is 15% less than the volume of 2015 (-306 thousand tons). The volume decline was driven by changes in shipment schedules for Gazprom (The Power of Siberia and North European Gas Pipeline) projects, as well as a decrease in demand on domestic and foreign markets. The largest drop is recorded in the segment of large diameter pipes (-27 [see article]

Anglo American's octopus lives to fight another day
Thu 16th Feb 2017 00:00 GMT
The head of Anglo American has seen the miners share price almost triple this year, topping gains in the benchmark FTSE 100 Index [see article]

China Steel Mills Hunt for High-Grade Iron Ore to Boost ...
Wed 15th Feb 2017 01:09 GMT
Cashed-up Chinese steel mills are chasing top quality iron ore to help increase traders said. In July and August, Tangshan city ordered curbs and some suspensions at sintering and coke plants, which turn coal into a fuel for use in blast furnaces [see article]

To see other steel sector news reports, check out our other steel news pages.



SELECTED STEEL INDUSTRY MAPS


Chinese seamless tube mills
Chinese seamless tube mills

For other steel location maps, visit our steel industry maps page.




CAPEX

STEEL PLANT CAPITAL INVESTMENT COSTS



BOF SLAB PLANT

BOF-cc-slab
All cost estimates are in 2016 US dollars.
For further info visit our steel capex page.

Capital costs describe investment for an integrated slab plant with continuous casting, typically with coke, sinter etc. Representative investments include:

  • CSA slab mill investment in Sepetiba, Brazil
  • CSN investment in Itaguai, Brazil
  • CVRD-Baosteel joint venture in Vitoria, Espirito Santo in Brazil
  • Sinosteel Corporation's investment in Jharkand, India.

Average cost: $4300m
Average capacity: 4210 kt
Sample size: 12
Average cost/tonne: $1050/t


INTEGRATED HOT STRIP MILL

BOF-cc-hsm
All cost estimates are in 2016 US dollars.
For further info visit our steel capex page.

Chart describes investments in ore-based integrated steel plants with hot strip production and sometimes other additional downstream rolling capability. Typical examples include:

  • Wuhan Iron & Steel investment in Fangchengang Port in China
  • ArcelorMittal investment in Karnataka, India
  • Tata Steel joint venture with VSC & Vicem for investment in Vung Ang in Vietnam.

Average cost: $7560m
Average capacity: 6660 kt
Sample size: 16
Average cost/tonne: $1200/t

Notes
Analyses above were last updated in January 2016. For further item-specific capital investment data see our steel capex database page.




EMPLOYMENT BENCHMARKS



steel sector employment benchmarks

Chart above shows current employment levels at 114 different steel firms around the world - companies that make flat, long and/or tubular carbon steel products. An average steel producer with a production capacity of ~3 mt steel/year typically thus has ~4000 employees. If your steel company employs more than this, please call us - our technical experts can assist with steel plant productivity improvement.

To discuss the interpretation of this chart and/or further information (including employment benchmarks for specialty steel production) please email us at the address shown at the foot of the page.




INDUSTRY SUPPLY & DEMAND FORECASTS FOR YEARS 2017-2018

Table below shows global crude steel production volumes and capacity figures - as assessed by World Steel Association and by the OECD to 2017 - and resulting calculation of steelmaking capacity utilisation. The overall picture for 2017 as compared to 2016 is that the global capacity surplus will get marginally worse [increasing from a capacity excess of ~784mt to ~790mt]. MCI's own estimates suggest that excess global crude steel capacity is likely to remain between 750-800 million metric tonnes in 2018.



Year
Production
million t
Capacity
million t
Capacity
Utilisation
2012
1560
2102
74.2%
2013
1650
2273
72.6%
2014
1670
2322
71.9%
2015
1620
2368
68.4%
2016
1623
2407
67.4%
2017
1632
2422
67.4%
2018
1640
2425
67.6%
Source: MCI analysis. Table last updated 22-Dec-16.

Graph below shows the relationship between steel prices and the global level of capacity utilisation - and indicates (both for HRC and for rebar) that prices fall ~$27/tonne per 1% drop in capacity utilisation.



world steel price levels

In 2017, on the basis that world capacity utilisation remains largely at 2016 levels of approx 67.4% (see table), MCI's consultants expect steel prices to remain at 2016 levels. In 2018, assuming a very small improvement in global capacity utilisation, we forecast just a tiny increase in steel price levels of the order of $5/tonne (hot rolled coil and reinforcing bar). For other products and / or for steel price forecasts through to 2020, please contact us.