Global steel output on downward trajectory

The Brussels-based World Steel Association (Worldsteel) says crude steel production in the 63 countries that report to it fell by 1.5 percent this September compared with output in September of 2022.

The 149.3 million metric tons produced this September were off by 2.4 million metric tons compared with last year. Perhaps more alarmingly, the output figure also was down by 3.3 million metric tons, or 2.16 percent, compared with the 152.6 million metric tons made the prior month.

Regarding the month-on-month drop, it can be explained almost fully by the steel sector’s performance in China, which currently makes more than half the world’s steel. Output in China dropped from 86.4 million metric tons made this August to 82.1 million metric tons last month.

By percentage, China’s steel output fell by 5.6 percent year on year and 5 percent month to month, according to Worldsteel.

A prolonged holiday week in China started Sept. 29, but that vacation-heavy time frame lasted until Oct. 6, meaning any vacation-related productivity loss should be more fully reflected in October’s steel production total.

If steel output remains heading downward in China, economists are likely to point to an apartment tower sector that is overbuilt and overleveraged, as well as an overall flattening of China’s steel intensity curve tied to coming down from the peaks of its urbanization and infrastructure investment trends.

In India, a growing destination for transboundary ferrous scrap, the hunger for steel continues into the autumn of this year. The nation’s mills produced 11.6 million metric tons this September, representing an 18.2 percent increase from the 9.9 million metric tons of output in September 2022. Output in India, however, fell by 300,000 metric tons month on month.

For scrap exporters, better news could finally be coming out of Turkey. That nation’s mills—largely scrap-fed electric arc furnace facilities—produced 2.9 million metric tons of steel this September.

That is an uptick from the 2.8 million metric tons made the prior month and represents 8.4 percent year-on-year monthly output growth of 200,000 metric tons.

Despite a labor-management dispute in the automotive sector in the U.S., output at mills in America rose by 2.6 percent this September compared with last year. However, mill output in the U.S. dropped by about 300,000 metric tons this September compared with the prior month.