Global stainless output falls for first time in 5 years

2nd March 2021

Global crude stainless steel production decreased to approximately 50.7 million tonnes in 2020 – down almost 3 percent, year-on-year. This reduction is lower than initially expected at the onset of the coronavirus pandemic.

However, it is the first decline in world output after four years of consecutive growth. In the main crude stainless steel producing countries, only Chinese and Indonesian output bucked the negative trend. Mill supply in these nations expanded by approximately 2.5 and 15.5 percent, respectively, compared with the figures recorded in 2019.

In China, stainless steel production reached an all-time high of 30.1 million tonnes, last year. This was due to the country’s rapid economic recovery from the coronavirus-induced low and the national authorities’ ability to contain any increase in Covid-19 infections.

Production in Indonesia was only marginally affected by the pandemic. Output continued to rise, as a result of growing capacity and strengthening demand from export markets.

In many of the established stainless steel producing countries, output is only now approaching its pre-pandemic rate. The uptick in production in the fourth quarter was unable to recover the lost supply caused by the lockdowns.

Production in the United States and Japan recorded reductions of more than 18 percent, last year. Mills in Europe fared slightly better with a 7 percent decrease. The recovery in stainless steelmaking has been gradual in these three areas. However, a surge in demand is creating shortages of material.

Global production is forecast to grow to 54 million tonnes, in 2021. Economic activity is expected to improve, and stainless steelmaking capacity will be gradually ramped up this year. This is particularly the case in Indonesia, where output is forecast to remain above that in many of the more established countries. Nevertheless, market confidence is likely to be boosted by the rollout of vaccinations in developed nations.

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