Charts above summarise the status of the industry worldwide as at February 2016. Steel price data is for hot rolled coil, with gauge indicating current export fob price in US $/metric tonne within a 10 year context. Current world steel capacity excess is shown at crude steel level in millions of metric tonnes. Iron ore price figures are for Chinese imported iron ore fines (62% Fe spot, CFR Tianjin port), in $ per metric tonne; gauge also shows the current iron ore price in the context of prices seen in the last 10 years.
Red zone on the gauges indicates a position of poor profitability and the danger of business collapse for steel makers and / or iron ore producers. Green zone is associated with strong industry profitability.
Verdict: With steel prices close to a 10 year low - reflecting a capacity excess of over 600 million tonnes of steel - the steel industry is at a crisis point. Upstream, the position is just as dire: with iron ore prices around $40/t, financial collapse of many higher-cost mines must be inevitable.
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Conference Title: Global Iron Ore & Steel Forecast Conference
Venue: Hyatt Regency Hotel, Perth, Australia
Start: Tue, 08 Mar 2016
Finish: Wed, 09 Mar 2016
Contact: Tel: +61 2 9080 4307
Description: The 19th Annual Global Iron Ore & Steel Forecast Conference & Exhibition will be held in Perth on the 8-9 March 2016. This event is renowned as one of the world's largest gatherings of senior iron ore and steel executives with thousands of industry personnel attending it over the years. It is recognised as the conference that delivers vital information on the status of the global iron ore and steel sectors [conference info]
For more steel industry events, visit our steel conferences page.
For other steel location maps, visit our steel industry maps page.
Question: Explain the term 'VOD'?
Answer: Vacuum Oxygen Decarburisation. A ladle steelmaking process in which oxygen is injected into molten steel under vacuum. This allows carbon to be removed from the steel without oxidising chromium. A method of refining stainless steel (see also AOD).
Question: Explain the term 'HBI'?
Answer: Compacted DRI, formed into briquettes for easier handling. The briquettes are commonly known as hot briquetted iron.
Question: Explain the term 'FIOR'?
Answer: Direct reduction process based on the use of iron ore fines to make iron units. FIOR is an acronym for Fluidized Iron Ore Reduction.
For more definitions, visit our glossary of steel terms page.
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INTEGRATED SLAB PLANT
Capital costs describe investment for an integrated slab plant with continuous casting, typically with coke, sinter etc. Representative investments include:
Average cost: $4300m
Average capacity: 4210 kt
Sample size: 12
Average cost/tonne: $1050/t
INTEGRATED HOT STRIP MILL
Chart describes investments in ore-based integrated steel plants with hot strip production and sometimes other additional downstream rolling capability. Typical examples include:
Average cost: $7560m
Average capacity: 6660 kt
Sample size: 16
Average cost/tonne: $1200/t
Analyses above were last updated in November 2015. 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.
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.
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 ~638 to ~667 million tonnes and global stelemaking capacity utilisation falling by ~0.7% in 2016.
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.
On the basis of the anticipated fall in 2016 of world capacity utilisation from 2015 levels of approx 0.7% (see table), MCI's consultants consider that world steel prices in 2016 will be ~$20/tonne below 2015 prices. For other products and / or for 2017+ forecasts, please contact us.