Commodity market report

Global steel long-term outlook Q1 2016

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Report summary

The current slowdown will be a drawn out affair and over the next few years the steel industry will have to learn to celebrate small and infrequent victories. The one material victory for steelmakers in Q1 has been a stronger than expected increase in steel prices. Having in most cases fallen below 2009 lows during the turn of the year steel prices have since regained between 1% and 23%. However we do not expect to see any further sustainable improvement till after 2018. Weak demand persistent overcapacity and low raw material prices will continue to limit the possible recovery in prices. As the year progresses so an increasing number of dreams for a speedy recovery for global steel consumption will be shattered. Overall as part of this update we have revised down our global long term steel demand forecast by a further 4.8% to 1 820 million tonnes in 2035. In line with this crude steel production has also been revised down by 4.7% to 1 955 million tonnes.

What's included

This report contains

  • Document

    SMS LT Q1 2016(V2.4).xls

    XLS 2.36 MB

  • Document

    Global steel long-term outlook Q1 2016

    PDF 1.24 MB

  • Document

    Global steel long-term outlook Q1 2016

    ZIP 2.02 MB

  • Document

    Executive summary

    PDF 85.95 KB

  • Document

    Market structure

    PDF 1.03 MB

  • Document

    Costs

    PDF 102.71 KB

  • Document

    Prices

    PDF 93.59 KB

Table of contents

  • Executive summary
  • Market structure
  • Costs
  • Prices

Tables and charts

This report includes 51 images and tables including:

Images

  • Turkish scrap consumption, collection and imports
  • Scrap imports v. crude steel production
  • Chinese regional railway plans – more than 36,000 km of regional railways will be built by 2020
  • Steel demand in the construction sector
  • Steel demand in manufacturing-related sectors
  • Steel exports are expected to reach ~120 million tonnes in the long term
  • Increasing exports will support the growth of production in the long term
  • Government targets are still not enough to restore a healthy utilisation rate
  • Crude steel, hot metal production and % of EAF steel production
  • Market structure: Image 16
  • Market structure: Image 17
  • Imports will continue to place pressure on crude steel production
  • A weak krone and low oil price reduces steel demand in Norway
  • Demand growth remains subdued
  • Despite registering growth in 2015, 2016 is shaping up for a sharp decline in crude steel production
  • Iron ore, coking coal and scrap prices
  • Hot metal costs and scrap prices
  • Rebar prices remain overvalued compared to HR coil
  • No immediate price recovery in sight
  • Japanese construction orders and starts
  • Tankan: fixed investment by sector in Japan
  • Japanese automotive production and exports
  • Japanese capacity adjustment
  • Domestic steelmakers under pressure from low-cost imports
  • Foreign direct investment for steel intensive sectors is small relative to the overall requirement
  • India has scope to grow – high population density requires more steel per square kilometre
  • Implied steelmaking capacity shortage to reach 70-90Mtpy by 2035
  • Market structure: Image 18
  • Market structure: Image 19
  • Turkey - house sales by type
  • Turkey - construction activity
  • Turkey - automotive production and exports
  • Turkey - steel content of automotive exports
  • MENA countries contribution to steel demand growth: 2015-2017
  • MENA steel demand growth: construction
  • MENA steel demand growth: manufacturing
  • MENA - DRI production and utilisation rates
  • MENA - scrap requirements
  • In Brazil, investment is essential for growth in steel demand
  • Due to a poor investment environment steel demand will not grow this decade
  • In Brazil there is no need for new capacity additions before 2035
  • Almost half of all flat product imports fall under the three landmark trade cases initiated in 2015
  • Steel imports have eased both due to falling demand and the trade cases. Demand recovery will limit any further falls in imports
  • Rising share of imports from those countries not under the trade investigations – corrosion-resistant steels…
  • …and cold-rolled steels
  • Weak steel demand growth in the medium term
  • Exports will remain important for domestic steel production. Finished-steel share to increase

Tables

  • Key China forecast data
  • Key plans in the next five years
  • Top steel makers ranked by profit and loss
  • Landmark trade cases launched in 2015

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