Latest output statistics indicate that the international market for stainless steel is picking up. It is highly likely that total Western World crude steel production could reach 18.5 million tonnes this year. This figure is similar to the record outturn in 2000.
Stainless steel manufacturing has been steadily increasing in recent years in China. The rate of growth will be even faster up to 2007. We do not have reliable statistics for output in China and the former Eastern Bloc countries. However, it is believed that their combined production in 2001 reached close to 1 million tonnes. Further expansion is expected this year. Consequently, global stainless steelmaking in 2002 is estimated to reach in excess of 19.5 million tonnes – the highest figure ever recorded. The signs for the industry are positive but need to be tempered with a little caution. The market is not yet in a position to return to the rapid growth rates of the past. The producers’ hopes, expressed at the recent International Stainless Steel Forum in South Africa, that past trends of 5 percent expansion would be reached in the second half of the year, are unlikely to be fulfilled. The decline in the LME nickel price will probably halt any inventory building. EU crude stainless output in the first quarter is expected to be confirmed at a figure higher than the outturn in 2001. Mills are showing a degree of restraint but also responding to their improved order situation. The final value in 2002 could exceed the result at the start of the decade.
Japanese producers are exerting control of their supply. Auto consumption is fair but general market conditions are weaker – particularly for construction and household goods. This year output is expected to slip by 3 percent. US production is forecast to rise by 10 percent as new melting capacity is ramped up at NAS. Carmaking demand is a little weaker. The manufacturing segment is sluggish but most of the extra output will come from import reductions. South Korean stainless steelmaking should be maintained at last year’s level. No improvement will be seen in the first quarter but slight gains are expected in the coming months as the overall domestic economy expands. An increase in output is forecast in Taiwan. The major cutbacks during the first half of last year are unlikely to be repeated – leaving the figure for the twelve months higher than in 2001. A modest upturn is possible in Brazil, Canada, South Africa and India. The producers in all these countries have the potential to lift supply in the near term. However, export prospects are likely to diminish, leaving the final figure little changed.
