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

STEEL INDUSTRY NEWS

ASIA-PACIFIC STEEL NEWS


steelworker

Steel Prices Scored Major Gains in April: Claim Your ...
Thu 5th May 2016 16:01 GMT
April was a huge month for steel prices. What appeared to be a rally lead by anti-dumping actions has turned into something more powerful due, in part, to a rebound in demand from China. It is now clear that China has unleashed a renewed government [see article]

Investors cheer NAB profit, drop in iron ore prices hits ...
Thu 5th May 2016 09:08 GMT
Mining stocks retreated after a drop in iron ore prices BHP Billiton slumped another 1.9 per cent to $18.43 and Fortescue Metals fell by 3.2 per cent to $3.03. Telcos were also sold Telstra lost 1.1 per cent to $5.56. But James Packer's gambling [see article]

UK STEEL CRISIS


Excalibur management buyout is frontrunner to rescue ...
Fri 6th May 2016 01:00 GMT
Excalibur has proposed most credible business plan for Tatas UK arm, but doubts remain about funding and pensions The Excalibur Steel management buyout has emerged as the frontrunner to rescue Tata Steel UK, although concerns about funding and pensions could still derail the bid. Sources close to the sale process said the proposed buyout, supported by Welsh billionaire Sir Terry Matthews , is [see article]

Tata Steel UK not willing to split up assets to secure ...
Wed 4th May 2016 01:00 GMT
Tata Steel is not prepared to split up its main British assets, such as its Port Talbot steel plant, as part of a plan to divest its UK steelmaking operations, UK CEO Bimlendra Jha told a committee of lawmakers on Thursday [see article]

Could the circular economy salvage Britain's struggling ...
Wed 4th May 2016 01:00 GMT
The ongoing debate over the UK's escalating steel crisis has failed to consider the circular economy as a potential solution, with Tata Steel's Port Talbot production plant well-positioned to become a national remanufacturing hub as a way of securing a more sustainable future [see article]

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



SELECTED STEEL INDUSTRY MAPS


World coke plants
World coke plants

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




CAPEX

STEEL INDUSTRY CAPITAL INVESTMENT COSTS



INTEGRATED 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 covering sinter, coke, DRI, blast furnaces, BOF plants, EAFs, induction furnaces, slab casting, billet and bloom casting, plate, hot rolled coil, cold rolled coil, hot dip galvanised sheet, tin plate, organic coated sheet, heavy sections, steel bar, wire rod, drawn wire, welded tube, seamless tube, pellets, washed coal, lime, PCI, air separation, power plant etc see our steel capex database page.




STEEL INDUSTRY EMPLOYMENT BENCHMARKS



steel industry employment benchmarks

Chart above shows year 2015 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 FORECASTS FOR 2016+

Table below shows global crude steel production volumes and capacity figures - as assessed by World Steel Association and by the OECD - and resulting calculation of steelmaking capacity utilisation. The overall picture for 2016 as compared to 2015 is that the global capacity surplus will get worse, with excess global capacity increasing from ~749 to ~799 million tonnes and global stelemaking capacity utilisation falling by ~1.6% in 2016.

In 2017 the global excess of world steel capacity is expected to be worse than in 2016, increasing to ~807 million tonnes.



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
1622
2371
68.4%
2016
1608
2407
66.8%
2017
1615
2422
66.7%
Source: MCI analysis. Table last updated 24-Apr-15.

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

On the basis of the anticipated fall in 2016 of world capacity utilisation from 2015 levels of approx 1.6% (see table), MCI's consultants consider that world steel prices in 2016 will be ~$43/tonne below 2015 prices. For other products and / or for steel price forecasts through to 2020, please contact us.