1.

Industry profile
1.1

Global overview

The steel industry is the second biggest industry in the world after oil and gas with an estimated
global turnover of USD 900bn, according to the World Steel Association (worldsteel). In 2015,
global steel industry faces headwinds from various fronts. Chinas slowdown, coupled with low
investment, financial market volatility and geopolitical conflicts in many emerging economies
has halted the high growth cycle. Worldsteel forecasts that apparent steel use (ASU) will
decrease by 1.7% to 1,513mn tonnes in 2015, following moderate growth of 0.7% in 2014.
Global steel demand is forecast to grow by 0.7% in 2016 to reach 1,523mn tonnes, based on an
improvement in the Chinese economy. Of concern is the vulnerability of the emerging
economies to external shocks. However, the recovery of steel demand in the developed
economies, although slightly weakened, remains on track.
Chinas deceleration has led to a lower global growth rate forecast for 2015. Steel demand in
China is expected to decrease by 3.5% in 2015 and 2% in 2016, following its demand peak in
2013, as the Chinese governments effort to rebalance the economy continues to restrain
investment activities.
Table 1: Global apparent steel use (ASU) for finished steel products (20142016)
Regions

ASU (mn tonnes)

2014

2015 (f)

Growth rate (%)

2016 (f)

2014

2015 (f)

2016 (f)

European Union (28)

148
149.8
153.1
5.0
1.3
2.2
Other Europe
36.9
40.1
40.6
0.1
8.6
1.3
CIS
56.1
49.9
49.9
-4.6
-10.9
0.0
NAFTA
144.8
140.8
143.7
11.4
-2.7
2.1
Central & South America
48.8
45.2
46.1
-4.7
-7.3
2.0
Africa
36.6
38.5
40.9
3.6
5.1
6.2
Middle East
51.9
53.9
56.3
4.5
4.0
4.3
Asia & Oceania
1,016.8
995.1
992.8
-0.9
-2.1
-0.2
World
1,539.9
1,513.4
1,523.4
0.7
-1.7
0.7
Developed Economies
413.0
404.2
411.6
6.4
-2.1
1.8
Emerging & Developing
1,126.9
1,109.2
1,111.8
-1.2
-1.6
0.2
Economies
China
710.8
685.9
672.2
-3.3
-3.5
-2.0
BRIC
70.1
73.3
77.2
5.7
4.6
5.2
MENA
516.1
423.3
439.6
2.6
1.7
3.8
World excl. China
829.1
827.5
851.3
4.5
-0.2
2.9
Notes: (f) = forecast; CIS = Commonwealth of Independent States; NAFTA = North American Free Trade
Agreement; BRIC = Brazil, Russia, India and China; MENA = Middle East and North Africa
Source: World Steel Association (worldsteel), Short Range Outlook October 2015

Growth performance is expected to vary across regions. Steel demand in the emerging
economies, excluding China, will grow by 1.7% in 2015 and 3.8% in 2016, despite slowdown in
some countries. For instance, Russia and Brazil are facing contraction in demand. On the
contrary, India and Mexico and other countries in the ASEAN and MENA regions is expected to

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maintain growth momentum, despite the adverse external environment, due to positive domestic
demand and reform progress. Steel demand in the developed economies see a setback in
2015, but return to growth is expected in 2016. The U.S. is expected to show negative growth in
2015 due to currency appreciation and a slowing energy sector, while in the E.U. there is a
recovery momentum aided by low oil prices, low interest rates and a weak euro. Developed
Asian countries like Japan and Korea are expected to show negative growth due to adverse
structural issues.
Table 2: Top 10 apparent steel using countries (2014-2016)
Countries

ASU (mn tonnes)

Growth rate (%)

2014

2015 (f)

2016 (f)

2014

2015 (f)

2016 (f)

China
United States
India
Japan
South Korea
Russia
Germany
Turkey
Brazil

710.8
107.0
75.9
67.7
55.5
43.0
39.4
30.7
25.6

685.9
103.8
81.5
64.0
54.8
38.5
39.5
33.9
22.3

672.2
105.2
87.6
66.0
55.2
38.2
40.5
34.3
22.5

-3.3
11.8
3.1
3.7
7.3
-0.7
3.7
-1.8
-8.6

-3.5
-3.0
7.3
-5.4
-1.3
-10.4
0.3
10.2
-12.8

-2.0
1.3
7.6
3.1
0.7
-1.0
2.3
1.1
0.5

Mexico

22.5

23.6

24.5

11.7

4.8

4.1

Source: worldsteel

The average global steel use per capita has steadily increased from 150kg in 2001 to 217kg in
2014, according to worldsteel. By 2050, steel use is projected to increase by 1.5 times from the
current level in order to meet the needs of the growing population.
By volume, most steel in the global market is crude steel. Global crude steel production totalled
1,212mn metric tonnes in the first nine months of 2015, a decrease of 2.4% y/y. Asia produced
828.9mn tonnes of crude steel in 9M2015, down 2% y/y and accounted for the largest share at
68.4%. The biggest steel producing country is China, which represented 50.2% of the total
production in 9M2015.
Table 3: Global crude steel production (mn tonnes) (20109M2015)

EU (28)
Other Europe
CIS (6)
North America
South America
Africa
Middle East
Asia
Oceania
Total

2011

2012

2013

2014

Jan-Sep
2015

% Change
9M-14/15

177.4
37.2
112.4
118.9
48.4
14.0
20.3
954.2
7.2
1,490.1

169.4
37.9
111.2
121.9
46.9
14.8
19.7
982.7
5.8
1,510.2

165.6
36.6
108.7
119.3
46.0
15.7
25.9
1,059.2
5.5
1,582.5

169.3
36.2
105.9
121.2
45.0
14.2
28.0
1,121.3
5.5
1,646.7

127.5
25.6
75.9
85.1
33.4
10.7
20.9
828.9
4.3
1,212.3

-0.3
-6.4
-5.8
-6.8
-1.4
-0.1
1.0
-2.0
5.5
-2.4

Source: worldsteel

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Table 4: Top 10 steel producing countries (mn tonnes) (9M2015)

Rank

Country

9M2015

9M2014

% Change Y/Y

% Share

1
2

China
Japan

608.9
78.8

622.0
83.1

-2.1
-5.2

50.2
6.5

3
4

India
United States

67.6
60.6

65.5
66.4

3.1
-8.6

5.6
5.0

5
6

Russia
South Korea

53.3
51.9

53.6
53.7

-0.5
-3.4

4.4
4.3

7
8

Germany
Brazil

32.6
25.3

32.5
25.6

0.1
-1.2

2.7
2.1

9
10

Turkey
Ukraine

23.8
17.1

25.8
21.5

-7.8
-20.5

2.0
1.4

Source: worldsteel

Chart 1: Top 10 steel producing companies in 2014

Shougang Group

30.8
31.4

JFE Steel
Wuhan Steel Group

33.1

Ansteel Group

34.3

Shagang Group
POSCO

35.3
41.4
43.3

Baosteel Group
Hebei Steel Group

47.1

Nippon Steel
ArcelorMittal

49.3
98.1
0

20

40

60

80

100

120

Mn tonnes
Source: worldsteel

1.2

ASEAN overview

Table 5: ASEAN apparent steel consumption (metric tonnes) (2014 vs. 2013)
2014

2013

% Change Y/Y

Thailand

17,323,257

17,603,911

-1.6

Vietnam

14,441,000

11,769,000

22.7

Indonesia

12,897,528

12,692,180

1.6

Malaysia

10,079,085

10,048,767

0.3

Philippines

7,324,727

6,704,674

9.2

Singapore

3,833,196

4,275,960

-10.4

Total

65,898,793

63,094,492

4.4

Source: South East Asia Iron and Steel Institute (SEAISI)

ASEAN steel consumption continued to increase, albeit at a slower rate of 4.4%, to 65.9mn
tonnes in 2014, lower than the growth rate of 7.7% recorded in 2013. Among the ASEAN
countries, only Vietnam and the Philippines enjoyed significant growth rates in steel
consumption in 2014, at 22.7% and 9.2%, respectively. Indonesia and Malaysias steel demand
still remained positive but with marginal increase of 1.6% and 0.3%, respectively. On the other
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