Commodity market report
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17 Pages

Global steel short-term outlook January 2016

Global steel short-term outlook January 2016

Report summary

The good news for steelmakers is that for the first time in months, HR coil prices have risen across the board in January. And the good news more or less ends there. The reasons for the price increase are mainly down to three factors. Firstly, H2 2015 price falls, particularly in China, were too deep, pushing HR coil prices below rebar and most producers into unsustainable loss-making territory. Secondly, January follows a holiday period in Europe and the USA and precedes one in China. Therefore, a moderate increase in activity is typical of the month. Finally, a sharp deceleration of imports in the last months of 2015 into both Europe and the USA has allowed prices in these two regions to finally stabilise.

What's included?

This report includes 2 file(s)

  • Global steel short-term outlook January 2016 PDF - 518.75 KB 17 Pages, 8 Tables, 29 Figures
  • SMS 2016 01 DataFile(V1.1).xls XLS - 247.00 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: contraction in focus
      • Steel mill profits have stalled since H2 2015
      • Cutting capacity: a more radical approach?
    • Europe: a mixed supply response to a saturated steel market
    • Conditions remain difficult in the USA
      • Stocks will drive steel demand in 2016
      • Production cuts continue
      • Trade cases have only limited impact on prices and imports
  • Costs
    • Iron ore lingers around US$40/tonne
    • Coking coal spot prices remain weak
    • US scrap price recovery will be short-lived
  • Key companies
    • Industry developments
  • Market structure
    • Global
    • China
    • Europe
    • USA
    • India
    • Japan
    • Russia

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

  • Executive summary
    • Prices and other key data
  • Supply-demand balances
    • Chinese mills profits have contracted sharply in H2 2015
    • The stock of unsold property soared in 2015 and will continue to grow in 2016
    • Supply-demand balances: Table 1
    • In Spain both increasing imports and decreasing exports have squeezed domestic steel production…
    • …whereas in the UK although imports have decreased, exports have decreased markedly resulting in the UK becoming a net importer.
    • Supply-demand balances: Image 5
    • Supply-demand balances: Image 6
    • The market has not absorbed announced price increases
    • Supply-demand balances: Image 8
    • Steel and scrap prices (tables and charts)
    • HRC prices rebounded in January, but the fundamentals remain weak
    • Construction steel is set for a difficult 2016, with Chinese demand expected to contract further
    • Supply-demand balances: Table 3
  • Costs
    • Iron ore stocks: neither mills or trader in a hurry to buy
    • Turkey scrap imports: no growth in sight
    • 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 down 2.9% in 2015
    • Manufacturing growth is slowing across the world
    • Demand is weak across the emerging markets...
    • 2016 will be better for mature markets
    • Steel production supported by exports
    • China automotive production up in 2016
    • EU steel demand remains high…
    • Market structure: Image 8
    • Underlying steel demand continues to grow…
    • Steel production declined by 10.5% in 2015
    • Steel demand continues to grow…
    • Steel production up 2.6% year-on-year in 2015
    • Crude steel production picks up
    • Japan steel consumption stable in 2016
    • Market structure: Image 15
    • Production down 0.5% year-on-year in 2015…
    • Key quarterly data
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