Posted on
The global steel story for the last month or so has centered around two main players: Russia and Ukraine. Now, the spotlight has shifted (if momentarily) to China and India. As two of the world’s largest steel exporters, what these countries have to say could greatly impact the global steel production forecast.
While China plans to curb its steel production further, India recently announced it would be stepping on the gas. This is largely based on figures handed out by the World Steel Association (WSA). In it, the Indian Government claims to be the only one of the top 10 steel-producing nations to register an increase in production in the January-March 2022 period compared to last year.
This week, India’s steel ministry issued an official statement saying the country had produced 31.9 million tons of steel in Jan-Mar 2022. This would signify growth of 5.9%. They also claimed to have produced 10.9 million tons in March alone. In response to their success, India plans to increase its efforts even further. The hope is that all this momentum will help the country achieve its 500 million ton production capacity target in the next 25 years.
Almost as an afterthought, the country’s steel minister said he had personally met with public and private steel producers. During these meetings, he reportedly asked them to step up their efforts while also keeping the country’s environmental commitments in mind. These include becoming carbon-neutral by 2070 and utilizing hydrogen technology to produce “clean & green” steel.
Besides India, the WSA report found that Brazil was the only other country among the top 10 nations to register growth in March.
So where was China in all this? Unfortunately, the world’s largest steel manufacturer reported a negative growth of over 10% during the first three months of 2022. Other nations such as Japan, The United States, Russia, South Korea, Germany, Turkey, and Iraq also reported negative growth in the same period.
This is nothing new where China is concerned. The nation’s continued focus on environmental restrictions in steel production, coupled with a fresh COVID-19 outbreak, practically ensured low numbers. According to a report by the National Bureau of Statistics, the world’s primary source of steel managed to put out just 88.3 million tons this March. Of course, this is a significant drop from the 94.02 million tons the country produced in March 2021.
The primary reason for the drop is the production curbs on northern steel mills. According to government officials, these mandates exist to cut pollution and improve air quality. Of course, the ongoing COVID lockdowns have not helped one bit. In total, China produced just 243.38 million tons of steel in the first quarter. This represents a drop of 10.5% from last’s years 271.04 million ton mark.
When it comes to steel prices and other metal indices, the only report you need is MetalMiner’s weekly newsletter. Sign up here and begin receiving valuable industry insights.
China’s drop in production could certainly affect exports. However, will the situation prove dire enough to increase global demand for Indian steel? According to this Hindu BusinessLine report, some experts think the answer is “yes.” In fact, a few estimate that Indian steel exports will hit an all-time high of over 20 million tons in FY22. If this proves true, it will exceed FY19 export numbers by around 19 MT.
V.R. Sharma, Managing Director of Jindal Steel and Power Ltd (JSPL), was quoted in the report as saying that steel demand continues to be strong. He went on to say that his company’s own order book indicates that some 35% of its sales in Q1 FY23 will be export-dominated. Thanks to China’s subdued exports, India’s flat steel producers are also getting access to new global markets. Among the most notable are Turkey and the United Arab Emirates.
The War Continues to Shake up Steel Markets
The global steel production forecast is by no means ignoring Europe. However, the continuing conflict is making economic predictions difficult. Just recently, the arm of Indian steel major Tata Steel announced it would stop doing business with Russia altogether. This puts them in line with a handful of non-steel Indian companies also engaged in anti-Russian boycotts.
Despite these efforts, Russia and India have only gotten closer since the Ukraine invasion. Ignoring pressure from other nations, India is continuing to buy Russian oil and commodities (and vice versa). Still, Tata Steel has decided to buck the trend. The company even said that all its steel manufacturing sites in India, the UK, and the Netherlands have already sourced alternative supplies of raw materials. The end goal? Ending the company’s dependence on Russia altogether.
Stay informed about global steel markets with MetalMiner’s monthly MMI Report. Sign up here to begin receiving it FREE of charge. For a real competitive edge in the metals industry, try a demo/tour of our revolutionary insights platform here.
Filed under: Ferrous Metals, Global Trade, Uncategorized
Your email address will not be published.
Aluminum aluminum price aluminum price index anti-dumping China china aluminum coking coal price Copper copper price copper price index ferrochrome price ferromoly price Ferrous Metals GOES price Gold gold price Green India Iron Ore iron ore price L1 L9 LME LME aluminum LME copper LME nickel LME steel billet nickel price Non-ferrous Metals Oil palladium price platinum price precious metals prices rare earths scrap aluminum price scrap copper price scrap stainless price scrap steel price silver price Stainless Steel stainless steel price Steel steel futures price steel price steel price index
MetalMiner helps buying organizations better manage margins, smooth commodity volatility, generate cost savings and negotiate prices for metal commodities. The company does this through a unique forecasting lens using artificial intelligence (AI), technical analysis (TA) and deep subject matter expertise.
©2022 MetalMiner All rights reserved. | Cookie Consent Settings & Privacy Policy | Terms of Service