The rebounding of China’s economy after the pandemic has ensured the contraction in contraction in global stainless steel consumption last year was smaller than the declines witnessed at the time of the global financial crisis of 2008 and 2009.
The perspective came Olivier Masson, senior analyst at Roskill, who was a guest speaker at the meeting of the BIR Stainless Steel and Special Alloys Committee during the latest BIR convention, which is being held online.
The 2.4% fall in global stainless steel consumption last year may have been smaller than the global financial crisis but it masked steep year-on-year falls in the USA (-17%), Europe (-9%) and Japan (-6%). That is because consumption growth of more than 6% in China came on the back of its government’s metals-intensive stimulus plan.
Masson’s presentation reflected the consolidation of China and Indonesia as key to global stainless steel developments. Their combined share of total stainless production rose from 52% in 2015 to 64% last year. Given their continued heavy reliance on primary nickel units, the global scrap ratio in stainless steel production slid to around 37% in 2020 from nearer 42% five years earlier.
He said Roskill was envisaging a gradual increase in the scrap use in China but only ‘a very, very small one’ because of the increased availability of NPI. If China put a cost on carbon emissions and on the environmental footprint of raw material production processes, this could bring greater use of scrap, Masson said.
Masson concluded by saying that the stainless steel industry was recovering well from the severe impacts the pandemic and was likely to remain the leading nickel demand driver. The battery market, notably for electric vehicles, was set to become the second-largest user of nickel units ‘by a significant margin’.
Fellow guest speaker Alina Racu, nickel market analyst at Nornickel, anticipated that long-term growth in nickel demand would come from the battery sector, driven by ‘green’ legislation. She estimated that nickel units required in battery production would surge by a factor of four or five by 2030.
The market was showing concern over the availability of suitable nickel units to meet this huge demand increase from the battery sector. Potential sources listed by Racu included exchange stocks, high-pressure acid leach extraction projects and conversion of nickel matte to high-grade Ni, while increased NPI production would create a usage shift in nickel units, it was contended. It would take a further 10 to 20 years for significant quantities of spent vehicle batteries to become available for recycling, she added.
Would you like to share any interesting developments or article ideas with us? Don't hesitate to contact us.