Global steel output to rise more than 5% in 2007

Edited by the Engineeringtalk editorial team Jan 30, 2007

The past seven years of this millennium have been the most productive in the history of the steel industry - rising by more than 450 million tonnes over the period.

Global steel output to rise by more than 5% in 2007 World crude steel production will show an increase of almost 10% in 2006 year on year.

In 2007 a further 5.4% growth rate is expected.

The past seven years of this millennium have been the most productive in the history of the steel industry - rising by more than 450 million tonnes over the period.

This equates to 57% growth in output over the figure recorded in 1999.

MEPS is now forecasting world wide crude steel making in 2007 at in excess of 1.3 billion tonnes (1307 million tonnes).

The oxygen/blast furnace process will continue to lift its share of manufacturing - rising by 11% in 2006 and almost 7% in 2007 to 873 and 932.5 million tonnes, respectively.

We predict substantial growth in the supply of direct reduced iron in 2007 as demand continues to expand.

In 2006, most steel producing nations benefited from the surge in consumption.

Those in Asia, however, took the lion's share, with 75% of the increase.

This figure is expected to rise to around 90% in 2007.

Steel output in the EU-25 will be reported at approaching 198 million tonnes for 2006.

This represents an increase of almost 6%, year on year.

A strong revival in the construction segment, coupled with an inventory building phase by steel users gave the mills opportunities to lift steel manufacturing.

A number of blast furnace outages in that twelve month period kept the growth in production from the process to more modest levels (2.8%).

Crude steel output in the remainder of Western Europe, excluding the EU, is expected to show a 3.6 million tonne growth (11%) in 2006 versus the previous year.

Both export and domestic demand have been extremely firm in Turkey.

Furthermore, new capacity installations have enabled the steel sector to push up output by well in excess of 10%.

Substantial increases in output have also been put in place with revived steelmaking in Serbia and Montenegro.

The outturn for crude steel production in the former USSR in 2006 will turn out to be close to 120 million tonnes - up 6.7 million tonnes (6%), year on year.

Russia will account for a substantial proportion of the growth, with near to 4.7 million tonnes.

The other main contributor will be Ukraine with around 2 million tonnes.

Russian local demand has been strong - driven partly by the energy sector.

Exports to Asia and the Middle East have also helped lift supply from both Russia and Ukraine.

Crude steel production in the NAFTA region in 2006 will turn out to be approximately 6 million tonnes up on the figure returned in the previous year.

Domestic consumption was extremely firm during the first half.

However, oversupply developed in the final six month period as import volumes rose and panic buying, from domestic mills earlier in the year, created excesses in the final two quarters.

In 2007, a modest turnaround is predicted and total output is likely to be lower as the inventory drawdown extends into the first half of the year.

South American steel output in 2006 will be slightly higher than the outturn in the prior year.

Local demand has been firm across most of the region - Brazil in particular.

The gains would have been much higher but for a major plant breakdown in the first half of the year.

We forecast substantial growth in steel production during 2007, amounting to approximately 3 million tonnes as consumption continues to grow and new capacity comes on stream.

Africa is the only region in the world likely to record a lower steel production in 2006.

This is the result of a significant fall in demand and supply in Egypt.

In the following year crude steel output is forecast to expand across most of the area as local requirements pick up.

Consumption of steel in the Middle East through 2006 went up dramatically compared with the year earlier figure.

However, local supply expanded only modestly.

This was due, in part, to serious plant breakdowns.

Substantial growth in steelmaking is predicted for 2007 as demand remains high.

Asian crude steel output in 2006 is expected to be reported at near 667 million tonnes - up by almost 84 million tonnes (14.3%) on the year earlier figure.

Chinese steelmakers were the main contributors to this substantial gain.

Further, but more modest growth is anticipated in 2007 - led once again by China.

No major steel output growth is anticipated in Oceania when the 2006 results are reported.

Small gains are expected in 2007.