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World Steel Production Report

ISSB Monthly World Steel Production Review

WORLD STEEL REVIEW, July 2012

Production of crude steel for the 64 countries reporting to the World Steel Association in May was estimated to be 130 million tonnes. This was just 0.7% higher than in May 2011, and the year to date was only 0.8% higher than the total for the same period in 2011 at 635 million tonnes. Excluding China, however, the May total was actually 0.8% lower than May 2011 and the 5 months total was 0.3% down on 2011. China accounted for nearly 47% of world steel production in the first five months of 2012.

In the European Union crude steel production for the 27 fell by 5.5% in May to 15.3 million tonnes, compared to May 2011. This brought the five months year to date total down by 4.4% to 74.2 million tonnes. German steel production actually fell by 9.7% in May, bringing the year to date total to 18.2 million tonnes, 6% down on the previous year. Italian steel production fell by 3.3% in May, but rose by 2.3% in the five months to 12.4 million tonnes. French production, however, increased by 1.3% in May, while the year to date total rose by 4.5% to 7 million tonnes. On the other hand Spanish production dropped by 13.9% in May, bringing the year to date total down by 14.9% to 6.2 million tonnes. In the United Kingdom steel production increased by 8.6% in May, but was 10.8% down in the five months to 3.7 million tonnes.

The Belgian five months total was down by 15.3% to 3.2 million tonnes, while the Greek total fell by 34% to just over half a million tonnes. Polish steel production, on the other hand, was 10.7% up in the year to date to almost 4 million tonnes.

Imports of steel by the European Union countries from outside the EU were 6.8 million tonnes in the first quarter of 2012. This compares to 9.26 million tonnes in Q1 2011, a drop of 26.7%. Exports, on the other hand, rose by 4.2% in Q1 2012 to 9.3 million tonnes. Italy is the largest importer of steel in the European Union and imported over 1.3 million tonnes, some 20% of the total, in Q1 2012, although this was 20% lower than in Q1 2011. The Belgian imports total fell by 15% to 963 thousand tonnes and the Spanish import total fell by 30% to 467 thousand tonnes. UK steel imports, however, increased by 5.2% in Q1 to 571 thousand tonnes and the Polish total rose by 6.4% to 435 thousand tonnes.

Turkish steel production rose by 6.6% to 3 million tonnes in May and by 10.4% to 15 million tonnes in the five months. This makes Turkey the eighth largest steel producing country in the world ahead of Brazil and the Ukraine. However, Turkish steel exports fell by 11% in April compared to April 2011, while imports of ferrous scrap rose by 41% to just over 2 million tonnes. Norwegian steel production jumped by 26% in the year to date to 292 thousand tonnes, while in Serbia steel production fell by 63% to 272 thousand tonnes.

According to ACEA, the European car manufacturers association, car registrations fell by 8.4% in May, and the five months total fell by 7.3%. German registrations were down by 4.8% in May, bringing the year to date total to over 1.3 million cars, just 0.3% higher than in 2011. French registrations, however, fell by 16% in May, and by 17% in the year to date to 840 thousand cars. Registrations in the UK actually rose by 7.9% in May, and by 2.6% in the first five months to 868 thousand cars. In Italy, on the other hand, registrations decreased by 14.3% in May, bringing the year to date total to 685 thousand cars, a fall of 19%. The Spanish five months total fell by 7.3% to 333 thousand cars.

Russian crude steel production was 6.1 million tonnes in May, 5.3% higher than in May 2011, while the year to date total was 4% up at 30 million tonnes. Ukrainian monthly production, however, decreased by 15.3%, bringing the five months total to 13.1 million tonnes, a drop of 12.2%. In Kazakhstan the year to date total was down by 24% to 1.6 million tonnes.

On the North American continent US crude steel production rose by 7.4% in May, and by 9.2% to 38.7 million tonnes in the year to date. Canadian steel production was 1.4% down in the month, but was 7% up in the five months to 5.9 million tonnes. In comparison Mexican steel production increased by 4.9% in May, but by just 0.3% in the year to date to 7.6 million tonnes.

Crude steel production in the South American countries was down overall, with Brazilian production falling by 11.7% in May, and by 1.2% in the year to date to 14.6 million tonnes. Argentinian steel production was down by 7.5% in the month, bringing the five months total to 2.3 million tonnes, an increase of 1.7%. In Venezuela, however, the monthly total dropped by 26.7%, while the year to date total decreased by 36% to 909 thousand tonnes. Colombian year to date steel production was up by 13% to 618 thousand tonnes, while Chilean production rose by just 1.2% to 744 thousand tonnes.

In Africa, South African steel production fell by 21.5% in May and by 19% in the year to date to 2.8 million tonnes. Egyptian production decreased by 1% in May, but was up by 3.2% in the five months to nearly 2.8 million tonnes. In the Middle East, Iran showed a 25% increase in steel production in May with the year to date total up 12% to 6.3 million tonnes. Saudi Arabian steel production, however, fell by 1% in the year to date to 2.25 million tonnes.

Turning to the Far East, Chinese steel production increased by 2.5% in May to 61 million tonnes, bringing the year to date total up 2.2% to 296 million tonnes, nearly 47% of world production. Japan's May production rose by 2%, although the year to date total was 0.7 down at just under 45 million tonnes. As the second largest steel producer in the world Japan accounted for only 7% of global production. Crude steel production in South Korea was 2% up in the month, making 29 million tonnes in the five months, an increase of 3.1% on the previous year. India's production increased by 3.9% in May, while the year to date total was only up by 1.5% to 30.2 million tonnes making it the fourth largest steel producing country in the world just ahead of Russia. Taiwan's monthly production decreased by 7.1%, bringing the year to date total to 8.9 million tonnes, a fall of 8.7%.

Chinese exports of steel increased slightly in May to over 5 million tonnes, the highest monthly total since June 2010. Steel imports in May also increased slightly to 1.35 million tonnes which was the highest total in 2012.

Japanese April exports dropped to 3 million tonnes, 21% less than the March total and 10% less than in April 2011. Hot rolled coil accounted for 30% of the April total with both HR plate lengths and coated sheets accounting for 12% each.

Phil Hunt
ISSB Ltd



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