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World Steel Production Report

ISSB Monthly World Steel Production Review

WORLD STEEL REVIEW, October 2011

Crude steel production in August was estimated to be 125 million tonnes, according to the 64 countries reporting to the World Steel Association, an increase of 9.8% over August 2010. The total for the first eight months of 2011 was just over one billion tonnes, 8.3% up on the same period in 2010. However, excluding China, the August total rose by only 6.5%, and the year to date total also showed an increase of 6.5%. Most regions showed a rise in steel production in both the month and year to date except for Africa and Oceania.

In the European Union crude steel production for the 27 member states rose by 4.3% in August compared to August 2010 to 12.7 million tonnes, while the eight months total increased by 4.4% to 121 million tonnes. German crude steel production increased by 5.3% in August, while the January to August total rose by just 2.8% to 30.5 million tonnes compared to the same period the previous year. Italian production jumped by 25.6% in August, while the year to date total rose by 11.2% to 18.7 million tonnes. Production in Spain actually fell by 7.6% in August, bringing the eight months total down 3% to 10.8 million tonnes. French production, however, increased in August by 19.7%, while the year to date total rose by 2.3% to 10.6 million tonnes. The United Kingdom showed a small drop in steel production in August of 3.7%, and the eight months total was down 2.3% to 6.6 million tonnes. Polish steel production rose by 16.4% in August, and by 8.3% in the year to date to nearly 5.9 million tonnes, just below the Belgian eight months total.

In the rest of Europe Turkey's crude steel production was 2.8 million tonnes in August, a rise of 7.8%; the year to date production, however, was up 19.2% to 22 million tonnes, more than the total for France and Spain combined. Steel production in Serbia fell by 10% in the month, but was just short of one million tonnes in the eight months, an increase of 19.4% on 2010.

Turkey's steel exports in July were 1.5 million tonnes, 10% above the total for July 2010, but nearly 10% below the April 2011 peak of 1.6 million tonnes. 36% of July's exports were deformed reinforcing bars, although this was slightly lower than the July 2010 total. Billets accounted for 17% of July exports with hot rolled wide coil accounting for a further 12%. The Middle East accounted for 38.5% of Turkey's exports in 2011, particularly the United Arab Emirates, Iraq and Saudi Arabia. The European Union accounted for 23% of Turkey's exports in 2011, with Africa accounting for a further 16%.

However, Turkey's imports of steel were only 878 thousand tonnes in July, 6.7% below the July 2010 total. One third of this total was hot rolled wide coil with semis (mostly billets) accounting for a further 21%. Scrap imports, on the other hand, rose to a total of 2.2 million tonnes, 70% higher than in July 2010 and only just below the December 2010 peak.

According to ACEA, the European Car Manufacturers Association, passenger car registrations in Europe fell by 1.9% in July, while the seven months total was down by 1.8% compared to 2010. In Germany registrations rose by 10% in July, and were 10.4% up in the year to date to nearly 1.9 million cars. In France, July registrations decreased by 5.7%, while the year to date total was virtually flat at 1.4 million cars. In the United Kingdom the July total fell by 3.5%, while the seven months total decreased by 6.7% to 1.16 million cars. Italian registrations, however, were down by 10.3% in July, with the year to date total down 12.7% to 1.15 million cars. The Spanish seven months total dropped by 24% to 521 thousand cars, while the Dutch total increased by 20% to 372 thousand cars.

In the CIS countries Russian steel production increased by 3.4% in August, bringing the eight months total to 46.3 million tonnes, 5.2% higher than the 2010 total. In the Ukraine crude steel production rose by 5.3% in August, while the year to date was up 6.9% to 23.3 million tonnes. Production in Kazakhstan increased by 21% in the eight months to 3.3 million tonnes.

On the North American continent crude steel production in the USA rose by 13.8% in August bringing the year to date total up 6.1% to 57.6 million tonnes. Canadian August steel production fell by 5.8%, with the eight months total increasing by just 1% to 8.9 million tonnes. Mexican production, however, increased by 21% in August, bringing the year to date total up 11.5% to 12.3 million tonnes.

In South America, Brazilian crude steel production in August increased by 1.5%, although the eight months total rose by 7.8% to 24 million tonnes. Argentinian steel production was up 4.6% in August, but 10.2% higher in the year to date to 3.7 million tonnes. In Venezuela, on the other hand, August production jumped by 35%, while the eight months total increased by 88% to 2.2 million tonnes. However, it is worth noting that Venezuelan steel production in 2010 was the lowest annual figure since 1981.

Production in South Africa, the major steel producing country on the African continent, fell by 5.5% in August, bringing the eight months total down by 18.4% to 4.4 million tonnes. Egypt's steel production fell very slightly in August, although the year to date total rose by 1.8% to just under 4.4 million tonnes. Steel production in Iran rose by 10.4% in August, while the year to date total was up 13% to 8.8 million tonnes, making it by far the largest steel producer in the MENA region and almost equal to Canada's total. Production in Saudi Arabia increased by 3.7% in August, and by 4.2% in the eight months to 3.5 million tonnes.

Among the key Asian countries Chinese crude steel production jumped by 13.8% to 58.8 million tonnes in August, bringing the year to date total up 10.6% to 469 million tonnes, 46% of the world total. Indian steel production rose by 7.4% in August, and by 5.3% to 48 million tonnes in the eight months. Japan's steel production was flat in August, while the eight months actually fell by 0.8% to 72 million tonnes. South Korean production, however, was up by 19.3% in August, and by 19% in the year to date to 45 million tonnes. Taiwanese steel production increased by 18% in the month and by 19% in the year to date to 15.5 million tonnes.

South Korean steel exports were 2.4 million tonnes in July, some 15.6% above the July 2010 total, although this was a little less than the monthly totals in January and June 2011 which both exceeded 2.4 million tonnes. Almost a quarter of the July total was hot rolled wide coil, with CR plate and sheet accounting for a further 17%. South Korean imports in July, on the other hand, fell by 7% compared to the same month in 2010. One quarter of the July total was semis (mostly slabs); hot rolled wide coil accounted for a further 21.5%.

Almost two thirds of South Korean exports of steel in 2011 went to other Asian countries, particularly China and Japan. North America accounted for a further 16% while the 27 member countries of the European Union only took 6% of the total exported in 2011. The Middle East accounted for 8.8% of exports in 2011 with the largest markets being Iran, the UAE and Saudi Arabia.

Phil Hunt
ISSB Ltd



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