Asia – ‘China’s supply glut is hurting the profitability and viability of the global steel sector,’ claims the European steel association Eurofer.
According to the organisation’s director general Axel Eggert, early-2015 customs data are fuelling concerns that ‘imports into the EU will remain at an elevated level as long as excess production – mainly originating in China – is being pushed into the international markets at cut-rate prices, thereby distorting traditional steel trade flows’.
The key uncertainty for EU steel producers is whether third-country imports will prevent them from benefiting from the mildly positive trend in EU steel demand, states Eurofer in its latest economic and steel market outlook. Total finished product imports over the first two months of 2015 increased 5% year on year but were 25% above the monthly average for the fourth quarter of last year and 7% higher than the monthly average for the whole of 2014.
‘For 2015, it is expected that imports will continue to rise and only in 2016 take a step back,’ says Eurofer. ‘As a consequence, domestic deliveries from EU suppliers will most likely see hardly any growth in 2015, before picking up by around 3% in 2016.’ Eurofer is projecting that EU apparent steel consumption will rise from 146 million tonnes in 2014 to 149 million tonnes this year and then to 153 million tonnes in 2016.