US flat product producers have successfully implemented at least a proportion of their latest round of proposed increases. However, the upward movements now appear to have stalled. Local supply is slowly returning to normal and the recent hikes, together with expanding domestic delivery lead times, have spurred an interest in imported material.International Steel Review

Canadian transaction values are unchanged from April, with some market participants anticipating a little softening during June, once regular supply is resumed. Production problems, at several mills, have kept things tight.

Chinese domestic prices continued to head downwards, following the May 5 Labour Day holiday. The cuts are being driven by excessive production capacity, falling raw material costs and slower manufacturing growth. Nevertheless, forecasts suggest that steel demand is set to improve as construction and manufacturing activities pick up for seasonal reasons.

In Japan, the supply/demand balance is improving. Since the Golden Week holidays (April 29 to May 5), shipments have increased, thus reducing inventories. Export volumes continue to trend downwards due to severe oversupply in the Asian region. Meanwhile, imports from China, Taiwan and South Korea are climbing, attracted by healthy Japanese demand.

In South Korea, a lack of sales opportunities in an extremely competitive export environment is being aggravated by the appreciation of the won. MEPS has noted no improvement in demand, which remains lacklustre, amidst surplus supply resulting from domestic overcapacity and an influx of cheap Chinese material.

The rebound in Taiwanese prices, experienced earlier in the year, has been blunted by a steel glut on the Chinese mainland which is creating import pressure. Moreover, local market demand has slowed due to a contraction in manufacturing output.

In Poland, steelmakers have, once again, reduced transaction figures in a climate of poor demand. Forecasts for steel consumption later this year remain cautiously optimistic. The economic recovery continues in the Czech Republic, helped by the devaluation of the local currency, which has boosted exports of finished goods.

In Western Europe, trading volumes of flat products have been slow since MEPS’ April report, due to a number of Easter and Labour Day holidays. Only minor price changes have been noted. Overcapacity, negative sentiment and increasing third country competition persist, enabling buyers to resist mill efforts to impose increases. Nevertheless, macroeconomic forecasts are optimistic in several countries, encouraging producers to slightly raise some of their offers.

Source – MEPS International Steel Review


Trading volumes of flat products have been slow since MEPS’ April research due to a number of Easter and Labour Day holidays in Western Europe. Only minor price changes have been noted. However, overcapacity, negative sentiment and increasing third country competition persist, enabling buyers to resist mill efforts to impose increases and, in some instances, to win small discounts. Nevertheless, macroeconomic forecasts are optimistic in several countries, encouraging producers to slightly raise some of their offers.

Strip mill product prices have weakened slightly in Germany, despite a relatively healthy business climate and improved consumer confidence. Supply and demand are out of balance. The market is being targeted by producers in other EU countries, where demand is less robust. Customers feel that steelmakers’ talk of price rises is just wishful thinking. Service centres, uncertain of market developments, continue to keep stocks low. Resale values are poor.

Activity has remained subdued in France, partly due to the Easter break and two public holiday weekends at the beginning of May. Producers have stabilised market prices and even raised some of their offers by €5/10 per tonne but buyers believe the outlook remains uncertain. End-user demand on distributors is muted and resale values are dismal.

The Italian market has been particularly quiet because of a large number of holidays over the last month. Despite several announcements by steelmakers, who are still officially proposing increases, basis figures have not picked up. However, generally, they have stabilised, although the mills are ready to negotiate if presented with a large, firm order.

UK basis figures appear to have bottomed out. However, the mills’ attempts to instigate a rise were totally unsuccessful. Service centres report that demand is holding up and that prices do not reflect the reasonably healthy market. Clearly, there is an issue regarding the exchange rate which is creating a favourable situation for overseas suppliers from mainland Europe and further afield.

MEPS has noted very little price movement in Belgium, where activity levels are flat. Business, overall, is quiet with several end-users experiencing payment difficulties. Market participants foresee no change until the autumn. In Spain, steelmakers have stopped demanding their proposed €20 per tonne hike. There has been some recovery in demand, albeit only small. Inventories at the distributors are slightly higher than necessary, so buyers are in no hurry to purchase more material, especially as the summer holidays are approaching.

Source – MEPS European Steel Review



According to Chinese customs, total steel exports in March reached 6.76 million tonnes. The figure for the first quarter of this year was 17.3 million tonnes. If the daily rate of steel exports, during the first quarter of 2014, continues for the whole of the year the total will be close toChina Steel Review 70 million tonnes – an all-time high tonnage. This would represent 8.3 percent of all the rolled steel output in the country. Such a proportion has not been reported since 2007.

To put this figure into context, only three other countries – Japan, United States and India – have steel industries which, currently, produce more finished steel products than the export sales from the Chinese steel sector.

However, the situation is not all bad. Low-cost Chinese exports are often seen as detrimental to the manufacturers in the industrialised nations of the world. However, the same exports have been a major factor in the rapid development of many newly emerging Asian countries.

Competitively priced flat steel products from China have enabled many new industries to be set up – particularly in South East Asia. These are providing employment in manufacturing and assembling components which are subsequently supplied to both western and eastern corporations.

Source: MEPS China Steel Review


MEPS forecasts world steel output, this year, at 1655 million tonnes. This equates to a 3 percent increase on the outturn in 2013. The majority of this growth will, once again, come from Asia, particularly China.

We believe that steelmaking in the EU will increase, this year, following a decline in each of the past two years. Our estimate, at 170 million tonnes, represents an annual increase of 2.6 percent.

Steel manufacturing in Europe, excluding the EU and CIS, should reach 40 million tonnes in 2014 – a rise of 3.1 percent, year-on-year.

Our 2014 forecast for steelmaking in the CIS has been downgraded in this issue and now stands at 108.5 million tonnes. This represents a slight decrease from the previous year’s outturn.

North American raw steel production is predicted to be relatively unchanged this year, compared with the figure recorded in 2013.

Our prognosis for the outturn of crude steel in South America this year is 46.7 million tonnes – up 1.5 percent from the 2013 level.

Steel manufacturing in Africa is forecast to increase this year to 16.55 million tonnes. This equates to a rise of 3.1 percent, compared with 2013.

Another record steel output figure is forecast for 2014 in the Middle East. At 27.4 million tonnes, this will be the sixteenth consecutive annual rise in production.

Total Asian steel manufacturing should reach a figure of more than 1.1 billion tonnes this year. This equates to an increase of 3.7 percent, year-on-year.

Source: MEPS World Steel Outlook Quarter 1-2014


hallenging trading conditions persist in China. Price growth returned to the billet and slab segments. However, market jitters remain evident. Local steel traders have expressed concerns that the steel-consuming sectors are starting to lose momentum. The China Metallurgical Industry Planning and Research Institute has forecast that domestic steel consumption will slow to 3.0 percent this year, half the rate achieved in 2013. Local brokers report that Australian seaborne iron ore fines in week 16 (with an iron content of 62.5 percent), were traded, on average, at US$116.00 per tonne CFR – an increase of 4.0 percent compared with the March settlement figure. However, prices began to trend downwards in week 17.Semi Finished Steel Review

The business environment remains challenging in South Korea. The building sector remains subdued. Domestic billet selling figures, in national currency terms, are down 2.5 percent compared to the corresponding period last year. Billet exporters have fared no better. Buying appetite amongst Asian re-rollers remains limited. The price differential between domestic and imported billet material has widened to US$24 per tonne.

Purchasing volumes of finished steel products in Taiwan are predicted to be stable, at best, in May. Brokers are forecasting that steel production may fall ahead of the summer months, citing weak end-user demand and electricity rationing. The premium for foreign cast billet relative to domestic material has narrowed to US$15 per tonne (previously US$25 per tonne).

Source: MEPS – Semi-Finished Steel Review


Worldwide total crude stainless steel output in 2013 reached an all-time high figure of 38.13 million tonnes. This exceeds the last peak, achieved the previous year, by 7.8 percent. MEPS predicts that global production will grow by a further 3.6 percent, this year, to reach a new record of 39.5 million tonnes.Stainless Steel Review

Global outturn in 2013 was higher than previously forecast. However, production in the EU, South Korea and Taiwan was lower than in 2012. Output in the United States and Japan began to trend upwards, albeit remaining significantly below the peak, pre-crisis figures achieved in 2006.

Production in China and other developing nations continues to expand at a faster pace than in the established stainless steelmaking countries.

China’s output climbed more quickly than had been predicted, to total almost 19 million tonnes, last year. Although the rate of growth is expected to slow in 2014, the forecast outturn of 19.75 million tonnes would represent exactly half of all worldwide production.

Output in countries in the “Others” category is predicted to increase by over 6 percent, in 2014, to reach 3.825 million tonnes.

While there are signs of economic recovery in the EU, producers in this region have lost market share, globally. Output in 2013 was down by 4 percent, year-on-year, at less than 7.2 million tonnes. A moderate recovery, to 7.3 million tonnes, is anticipated this year.

Production in the United States grew by more than earlier forecasts, to just over 2 million tonnes, in 2013. However, the outturn this year is expected to remain at a similar level.

Japanese stainless steelmaking showed modest annual growth of 1.2 percent, in 2013. A stronger upturn is predicted in 2014, to achieve a total of 3.3 million tonnes – up 4 percent on the year earlier figure.

Output in South Korea is expected to turn around, with a 3 percent, year-on-year, increase this year, following a small drop in 2013.

Production in Taiwan decreased by 25,000 tonnes last year, compared with the previous twelve month period. However, the outturn in 2014 is forecast to be close to the 2012 figure.

Source: MEPS – Stainless Steel Review