Tag Archives: Crude Steel

MEPS Forecasts Global Crude Steel Output at 1.7 Billion Tonnes This Year

World crude steel production is expected to expand, markedly, in 2017. Steel demand has rebounded, this year, amid an improving economic climate. A revival in investment is underway in many countries. Moreover, we note a continued firm level of consumption.

MEPS has upgraded its prediction for steel output in China and the rest of the world. Global production is forecast to surpass 1.7 billion tonnes in 2017 – up by 5 percent, year-on-year. Outside China, the largest gains, are expected to be attributed to increased output in Iran, India and Turkey. These three countries have all recorded strong export sales, this year.

A healthy performance is noted in the developed economies, with a recovery in steel supply and demand, in the EU and United States. Steelmakers worldwide, particularly scrap-based producers, have been able to raise output due to a reduction in the volume of Chinese finished and semi-finished steel exports.

The outlook for steel production and consumption, in 2018, is broadly positive. However, MEPS predicts that the current growth levels are unsustainable in the long term. The recent upturn is largely cyclical and recovering from the lows witnessed in late 2015/early 2016. Steel demand growth is expected to weaken and the problems of structural overcapacity remain, largely, unresolved. Low capacity utilisation levels, in many countries, are likely to constrain mill profitability.

Source: MEPS – World Steel Outlook to 2020

Primetals Technologies modernizes wire-rod mill in Turkey for Kroman

  • Upgrade to improve product quality for entry into new markets
  • Latest laying head technology incorporates durable SR Series pipe
  • Cooling conveyor modified with Optimesh technology

Turkish steel producer Kroman Çelìk Sanayìì A.Ş has contracted with Primetals Technologies to apply advanced technology to a wire rod outlet built in 2008 to expand its product line with high carbon wire rod. Signed last year, the contract calls for 13-month delivery of equipment, with erection and commissioning expected to be completed by the end of this summer.

In this regard, Kroman’s new #2 mill includes a Morgan Intelligent Pinch Roll and the latest laying head technology with SR Series self-regenerating pipe, designed for longer pipe life. In addition, the contract calls for modifications to the existing cooling conveyor with the incorporation of Optimesh technology and upgrades to the reform tub and ring distributor. The new equipment has a guaranteed speed of 110 m/s.

Founded in 1967, Kroman is based in Darıa-Kocaelì, Turkey. With two steel shops, two wire rod mills, a rolling profile and a bar rolling mill, it produces more than 1.3 million tons of crude steel annually.

Source: Primetals.com

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In early November, Worldsteel, the body representing the international steel industry, published its latest issue of Steel Statistical Yearbook. Included in the document, was a significant upward revision to the figure for Chinese crude steel production in 2013. It now stands at near 822 million tonnes – more than 30 million tonnes above the last recorded outturn.

MEPS has consistently been indicating, in its regular reports on the Chinese steel sector, that the actual annual crude steel and pig iron output exceeded the officially recorded figure by 30/40 million tonnes.

The crude steel under-reporting was recently confirmed by Mr Xu Lejiang, Chairman of Baosteel Group, who stated that the outturn for production in 2013 was 822 million tonnes. This figure appears to have now been accepted as a true figure. It is in line with the calculated MEPS data, published early this year.

Revisions to crude steel output are not the only industry statistics which require modification. MEPS contends that pig iron production has also been understated for all of this decade by similar tonnages to those for steel.

It is important that the Chinese authorities investigate the reasons for errors in the historic output statistics and rectify the situation. This would enable accurate steel output trends to be identified. Related industries depend heavily on reliable data for investment planning etc. This is a pre-requisite for governments, like China, which operates a system of central planning.

The amount of under-reported iron and steel production represents slightly less than 5 percent of the total. However, the misinformation has served to mask any quantitative assessment of the amount of extra air and water pollution which was being put into the country in recent years.

It is difficult to understand how the steel sector’s reporting system failed so badly. The industry supplies a plethora of information which is poured over and evaluated in great detail by the press and other institutions – specifically designed to prepare strategies for the future.

Perhaps the growing private steel sector in China needs to be given the same degree of scrutiny as that sustained the publicly owned mills.

Source: MEPS China Steel Review – November Edition


In 2011, MEPS reported its belief that the National Bureau of Statistics figures for China’s crude steel production understated the actual output by approximately 6 percent. This fact was subsequently acknowledged by a senior member of the China Iron and Steel Association but no action appears to have been taken in the interim to change the situation.

Recently, Mr Xu Lejiang , Chairman of Baosteel Group, is reported to have stated that China’s crude steel production, in 2013, was 822 million tonnes. This was further reinforced in a recently published article by Mysteel, that an unnamed source had disclosed that up to 70 million tonnes of steelmaking capacity is unreported. By contrast, the latest figure issued by the country’s National Bureau of Statistics is 785 million tonnes.

Mr Xu’s assessment of crude steel output, in 2013, is broadly in line with MEPS latest calculated minimum figure of 815 million tonnes, published in the latest issue of MEPS CHINA STEEL REVIEW. Perhaps the disclosures from the two local steel sector experts will generate action from the authorities responsible for providing production statistics for the steel industry in China.

It is not satisfactory to have doubts about the accuracy of steel production statistics – particularly, for a country as large as China’s with its importance to the global mining sector and steel supply. Moreover, how can the authorities make meaningful decisions about investment, rationalisation, emissions control, privatisation issues etc for an industry in which there is no consensus about the most basic statistic – the level of output?

It is even more surprising when one considers the amount of analysis that takes place, almost on a daily basis, about the industry. Production from a part of the industry is reported three times every month. Percentage changes are analysed to two decimal places and the results reported in the press.

Steel prices are collected and published daily by a number of different organisations. We see futures contracts for steel products and raw materials. All this activity takes place with no concern for the accuracy of the industry’s production data.

Why do the authorities allow this situation to continue? MEPS highlighted the problem three years ago. It has now been confirmed by two steel industry insiders. It is not surprising that the sector was allowed to over-invest in steel manufacturing when the authorities fail to monitor accurately the size of a key matrix – the country’s output.

Source: MEPS China Steel Review – August Edition


World crude steel output is forecast at 1655 million tonnes this year, according to MEPS (International) Ltd. This equates to a rise of 2.7 percent over the previous all-time high figure in 2013. China will continue to be the main driver for expansion, despite a WSOPiedeceleration in growth.

Most regions saw their production fall last year. In 2014, noticeable gains are predicted in the EU and South Korea. Only marginally increases are envisaged in Other Europe, CIS and the Americas. Output rises in India are projected to be below the country’s vast potential. Solid expansion will continue in the Middle East, although the region’s share of global growth is expected to be just 3.4 percent.

Source: MEPS World Steel Outlook Quarter 2-2014