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

ARCELOR MITTAL STEEL NEWS


steelworker

ArcelorMittal wary of rallying Chinese steel prices ...
Fri 27th May 2016 10:01 GMT
Automotive World (press release) - ArcelorMittal has reported a net loss of US$400m in the first quarter (Q1) of 2016 as a result of increasingly unfavourable market conditions toward the end of 2015. In the first nine months of last year, Chinese steel exports rose 31% year-on-year [see article]

'Steel committee' to be set up to monitor AMSA's 'fair ...
Thu 26th May 2016 16:00 GMT
Government would, within weeks, finalise a fair pricing agreement with steel producer ArcelorMittal South Africa (AMSA) and establish a steel committee to monitor implementation of the formula, which would be based on a basket of selling prices in [see article]

UK STEEL CRISIS


Tata Steel: 'Guarantees needed' if sale pulled ...
Sun 29th May 2016 09:45 GMT
BBC News - The Indian-based firm announced it was selling its loss-making UK business in March, putting thousands of jobs at risk, including 4,100 at Port Talbot. There are two known bids, while the UK government could take a 25% stake in any rescue and may allow [see article]

China and US clash over cheap steel imports - BBC News
Thu 26th May 2016 07:59 GMT
BBC News - US and European steel producers claim that Chinese producers are selling at below-cost prices and thereby distorting the global market. India's Tata Steel has put its loss-making steel plants in the UK up for sale. In May, the EU launched an [see article]

Steel crisis: Tie-up could save Tata's Port Talbot ...
Tue 24th May 2016 11:52 GMT
The Week UK - - A widely reported tie-up between two of the main bidders for Tata Steel's UK assets could mean the shelving of a frontline proposal to shut down the blast furnaces at Port Talbot. The fate of the plant, which employs 4,000 people, had become a [see article]

To see other steel sector news reports, check out our other steel industry news pages or visit our ArcelorMittal news or UK steel crisis news page.



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 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.