Global steel production dropped 1.2% in 2008 in the backdrop of declining demand for manufactured goods as well as tight credit conditions.
The World Steel Association has said that the global steel production figures recorded a YOY decline of 1.2% in 2008, with the total crude steel production of 1329.7 Million Tons, as reported by metalworker.
In EU27, the crude steel production plunged 5.3% annually in 2008 to reach 199 Million Tons whereas in North America, the production slumped 5.5%. Crude steel production in the US fell 6.8% to 91 Million Tons, while in Russia, it slid down 8.1% to 69 Million Tons. Japan witnessed a YOY drop of 1.2% in 2008. In contrast, production in China, South Korea and India increased 2.6%, 3.7% and 3.8% respectively during the same period.
All major steel producing regions and nations, including North America, EU, South America and the former Soviet Republics, witnessed drop in steel production as the global demand for manufactured products declined in the later half of 2008. Global financial recession has slowed the demand for durable products as a result the industrial production slumped down further.
From September 2008 till end of the year, the decline in global steel production took a faster pace as the economic slowdown started affecting almost all steel producing countries. Thus, steel producers across the world have cut down their production since middle of 2008.
Further, falling demand on account of lower number of construction and manufacturing projects as well as shortage of credit also contributed to the decline in steel output.
However, some regions such as Asia and the Middle East recorded positive growth in steel production. In 2008, China, which doubled its steel output during 2004-08, became the first nation ever to surpass the 500 Million Tons steel output in just one calendar year.
According to a Research Analyst at RNCOS, “Weak demand led to decline in the global steel production during 2008. Moreover, the worsening conditions that appeared in Q4 2008 are expected to continue in the Q1 2009. However, reduction in steel prices may lure the industrial metal buyers, particularly manufacturers of heavy equipments, providing a ray of hope to the steel producers worldwide."
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