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World economic crisis drives 2008 stainless production lower
Tue 24 Mar 2009
Hong Kong, 12 March 2009. The world stainless steel production reached 25.9 million metric tons (mmt) in 2008 according to preliminary figures released today by the International Stainless Steel Forum (ISSF). The total is 6.9% lower than 2007 level. After a decrease of 2 % in 2007, this is the second year in a row that world stainless steel production has decreased.
Beyond the normal seasonal factors of our industry, 2007 as well as 2008, turned out to have the same pattern: excellent first half, extremely depressed second half. The external raw materials price volatility and the overall worldwide economic situation added to the turmoil.
The first half of 2008 turned out as being quite positive. By the third quarter, the financial and economic crisis combined with a massive drop in raw material prices – nickel being no exception – struck massively all cyclical industries. Our industry did not escape, on the contrary. Due to overstocks, reduction of excess inventories bought at inflated prices, complete stop of purchases from distributors and some end users, in a matter of weeks we moved from a bright future to a gloomy environment.
Overall stainless steel production in Asia w/o China declined by 10.3% to 8,1 mmt in 2008. Asia w/o China and China now account respectively around 31% and 27 % of the stainless steel produced in the world. Over the past few years China has been the driving force behind the growth in stainless steel production. However, in 2008 the country reduced production by 3.6% to 6.9 mmt.
The second biggest stainless producing area, Western Europe/Africa, reported a decrease in stainless steel production of 4.8% to 8.3 mmt in 2008.
The Americas region decreased stainless crude steel melting by 11.1% to 2.3 mmt. Production in the Central and Eastern Europe region declined by 8.6%, more than the world average. However, with production of just 333,000 tons in 2008, the region remains a minor player in world stainless steel production.
Source BSSA
