ISSF Projects Recovery in Stainless Production in 2008
05/22/2008 - The International Stainless Steel Forum is expecting stainless steel crude steel production to recover in 2008 following the 2.6% fall in production during 2007.
The International Stainless Steel Forum (ISSF) is expecting stainless steel crude steel production to recover in 2008 following the decrease in production during 2007.
ISSF’s latest forecast, issued during its Annual Conference (ISSF-12) in Paris, France, projects that global stainless crude steel production will reach 29 million tonnes in 2008. The forecast growth rate, above the long-term average, is based on the assumption that real demand will grow by approximately 6.0%. ISSF believes demand will be driven by a natural increase in industrial production.
Global stainless crude steel production fell by 2.6% in 2007 based on significant, never-seen-before stock draws after the crash of nickel prices in May 2007. The drop in volume includes a stock draw of more than one million tons. In contrast to the fall in production, ISSF estimates that during 2007, basic demand for stainless steel actually increased by more than 8% in the light of strong, worldwide industrial production growth rates.
In 2007 Asia—which continues to be the largest stainless-steel-producing area in the world—was the only region reporting an increase in production. ISSF expects a further growth of approximately 7% to 17.2 million tonnes in 2008. China was the driving force behind the production growth in Asia. In 2008, China will continue to expand its stainless production as significant new capacities (currently in the commissioning phase) comes on-stream. China became the world’s leading stainless steel producer in 2006 and it will further increase the gap to the number-two producer, Japan, in 2008.
The second-largest stainless producing area is Western Europe/Africa. This region was hit by production losses in the second half of 2007, causing the region’s stainless crude steel production to decrease by 13.3% to 8.7 million tonnes in 2007. In 2008, ISSF expects an increase in production and a slight growth in real demand. The forecast for 2008 is for production to grow by 4.4% to 9.1 million tonnes.
In the Americas region, stainless steel production decreased by almost 12% during 2007. ISSF expects an increase of 3.7% in the region’s stainless steel production in 2008 to 2.7 million tonnes.
ISSF estimates that the Central and Eastern Europe region will see continuously rising levels of stainless steel production. However, cautions ISSF, on a global scale, production volumes are likely to remain low.
At the current time ISSF does not see a big risk to stainless steel demand from underlying basic developments in the stainless-steel fabricating industries. However, a substantial risk is seen in rising raw material prices for iron, chrome, and manganese.
