Commodity market report
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21 Pages

Global steel short-term outlook April 2016

Global steel short-term outlook April 2016

Report summary

Since the start of this year steel prices have defied expectations across the world and have shown much higher increases than we had expected. Most of the increase in China was driven by three factors – speculation, easing monetary policy and more ambitious targets on capacity closures. In the US and Europe, low-cost imports were priced out of the markets by widespread import duties providing support for domestic prices. However, we do not think that this price surge is sustainable. 

What's included?

This report includes 2 file(s)

  • Global steel short-term outlook April 2016 PDF - 533.62 KB 21 Pages, 8 Tables, 29 Figures
  • SMS 2016 04 DataFile(V1.3).xls XLS - 284.50 KB


As global demand weakens and commodity prices fall, we're seeing a challenging environment in the metals and mining industry. Mining companies are increasingly coming under pressure to reduce operating costs, causing many to shift their strategic planning, delay new investments and look to long-term future growth.

This Steel Short Term Outlook report provides a detailed breakdown of global supply and demand balances in this market, as well as price forecasts.

Mining companies, investment banks and investors can use this report to understand the future direction of the ferrous and base metals market. It will also help you assess the impact of key industry issues and events on market balances and pricing.

From acquisitions to investments, Wood Mackenzie helps you plan, forecast and benchmark in the metals markets. Our proprietary database and analyst expertise combines robust production, consumption and pricing data with detailed analysis to identify market opportunities.

We give you a holistic view of the ferrous and base metals markets so you have the confidence to make strategic decisions.

  • Executive summary
  • Supply-demand balances
    • China - stimulus measures drive price rises
      • Property sector sees a recovery in recent months
      • Supply rationalisation intensified
      • Price surge brings some much needed relief for steelmakers
    • In Europe, 2016 shows early signs of modest demand growth
      • Supply response has been limited
      • Short-term measures have led to price rises
    • US domestic steelmakers benefit from price rises
      • Scope for further price increases exists
      • The US is not an isolated market
  • Costs
    • Monthly iron ore prices approach US$60/tonne for April
    • Spot coking coal prices follow steel and iron ore up
    • Turkish scrap prices lead global prices higher
  • Key companies
    • Industry developments
  • Market structure
    • Global
    • China
    • Europe
    • USA
    • India
    • Japan

In this report there are 37 tables or charts, including:

  • Executive summary
    • Prices and other key data
  • Supply-demand balances
    • So far we have recorded around 36Mtpy of steel capacity that is scheduled to be restarted in 2016:
    • Housing prices have diversified in Q1
    • Housing stocks have decreased so far in 2016
    • Supply-demand balances: Image 3
    • Supply-demand balances: Image 4
    • Despite the aggressive price announcements, US flat-product prices have risen slower than in China
    • Flat product imports have eased due to a lower regional price spread and high import duties on certain products
    • US long-product prices have risen slower than Chinese prices
    • The unusually high regional price spread is gradually closing and imports of long products are not likely to increase
    • Steel and scrap prices (tables and charts)
    • Price increases since the start of the year have caught many market participants by surprise...
    • However we expect prices to lose some momentum as the year progresses
    • Supply-demand balances: Table 3
  • Costs
    • Iron ore stocks: both mills and traders stocks are healthy
    • Scrap to iron ore: despite increases in the prices of both scrap continues to be at a disadvantage to hot metal
    • Costs: Table 1
  • Key companies
    • EBITDA margin for selected steel makers (table and chart)
    • Key companies: Image 1
    • Operating results
  • Market structure
    • Global crude steel production is down 0.5%...
    • Confidence in manufacturing growth…
    • Demand in emerging markets is improving…
    • Steel demand in mature economies…
    • Steel stocks will rise in the coming months
    • Steel production will increase
    • EU new car registrations are increasing…
    • Market structure: Image 8
    • Steel shipments will increase
    • Steel stocks will rise
    • Steel demand growth continues…
    • Crude steel production has risen sharply…
    • A pick-up in steel exports supports production
    • Steel stocks could rise
    • Market structure: Image 15
    • Crude steel production seasonally stronger
    • Key quarterly data
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