Global stainless steel production set for 4-year low
Global crude stainless steel production is predicted to reach an annual total of 47.2 million tonnes, in 2020. Following four consecutive years of growth, this would represent a decrease of almost 10 percent, compared with the year earlier figure. The slowdown is predominantly due to the Covid-19 pandemic, and the measures put in place, by authorities around the world, to limit its spread.
The effects of the coronavirus outbreak were being reflected in market activity in March 2020. Worldwide production was down by almost six percent, year-on-year, in the first quarter.
Restrictions applied by national and local governments, in many stainless steel-producing regions, were at their most stringent during the period from April to June. MEPS estimates that global production was around 20 percent lower than that recorded for the same three months in 2019.
In Europe, despite significant production cuts around the peak of the pandemic, many supply chain participants continue to report weak order loads. As a result, most stainless steelmakers will shut down for their traditional summer holidays. Consequently, a seasonal dip in output will be recorded, as usual. A gradual increase in activity is anticipated, thereafter.
In the United States, output is estimated to have fallen substantially in the second trimester of 2020. A slow recovery is expected, but this may be hampered by the continuing spread of the coronavirus in that country.
A major decrease in production is expected to be reported for the second and third quarters of 2020, in India. Severe lockdown measures have been employed to fight against the transmission of Covid-19.
In China, where the effects of the coronavirus were first noted, a major downturn in production was recorded in the early months of this year. Output is expected to return to almost pre-pandemic levels, by the end of 2020.
South Korea and Taiwan are expected to report relatively moderate reductions in output, during the period from April to September. Production in Japan is estimated to have decreased substantially, in the second quarter. All three countries are forecast to recover, later in the year, to output rates similar to those recorded in 2019.