India emerges as third largest steel producer in the world
Steel production in India rose 2.6% during the year over an output of 87.3 mt in 2014 even as world steel output went down 2.8% in 2015
KOLKATA: India has emerged as the third-largest steel producer in the world after China and Japan, beating the US to the fourth position. However, there is little reason to cheer as steel production in India rose 2.6% in 2015 to 89.6 million tonne (MT), even as world steel output went down 2.8% to 1.6 billion tonne, according to data released by the Brussels-based World Steel Association (WSA), whose members present 85% of world steel production.
Almost all steel producing regions reported lower output led by China, which produces more than half of total world steel output.
However, a closer look at the absolute numbers show that the increase in crude steel production was not significant and it came on a small base.
A steel industry veteran Seshagiri Rao, group CFO at JSW Steel, explained: "As on date, the country's installed steel making capacity is 120 MT. With 89.6 MT of production, the capacity utilisation was estimated at only around 74.6%." The other point to note is that finished steel is estimated to have rose by a mere 1.4%, he said.
"The domestic steel remains subdued. Producers are facing difficulty in selling even this additional production in the market and it is largely adding to inventory. In fact, incremental demand growth is mainly being met by imports," Rao said.
In the US, steel output shrank nearly 10.5% in 2015 to 78.9 MT during the year. The fall in the US steel output was the second biggest after Ukraine, which saw a 15.6% decline in steel output to 22.9 MT during the year.
Overall steel production in North America fell 8.6% to 110.7 MT in 2015. In the CIS countries, steel output showed a 4.3% decrease in 2015 to 101.5 MT, with Russia's production at 71.1 MT, down 0.5% on 2014. In South America, steel production showed a 2.5% decrease on 2014 to 43.9 MT as Brazil produced 33.2 MT lower by 1.9% over its production in 2014.
In the Asian region, China produced 803.8 MT of steel in 2015 down 2.3% against 822.8 MT it had produced in the previous year.
Japan saw a 5% drop in steel output to 105.2 MT in 2015 over 110.7 MT of steel produced in 2014. South Korea saw a 2.6% decline in steel production to 69.7 MT compared with 71.5 MT a year ago. The European Union (EU) produced 166.2 MT of crude steel in 2015, a decrease of 1.8% compared to 2014. Germany's production was down by 0.6% to 42.7 MT in 2015, while Italy's output went down 7.1% to 22 MT and France posted a crude steel output of 15 MT that was 7.2% lower than the previous year.
Within the EU, Spain was the only exception with a 4.4% increase in crude steel output to 14.9 MT in 2015.