|
|
South Africa Metals Report Q3 2009Published by: Business Monitor International Published: Jul. 7, 2009 - 42 Pages Table of Contents
AbstractThe South African steel industry should begin to show year-on-year (y-o-y) growth in Q409, with pricerises expected in H209 as export markets show signs of recovery, according to BMI’s latest South AfricaMetals Report.In the first four months of 2009, South Africa’s crude steel production plunged 25.8% y-o-y to 2.2mntonnes, according to the latest data from the World Steel Association. This follows a dismal performancein 2008 when steel production fell 9.1% to 8.27mn tonnes with a large slump in output reported in Q408,when output fell 42% y-o-y. However, output has begun its recovery from the December low-point whenproduction totalled just 188,000 tonnes, reaching 580,000 tonnes by April, though still down 22% y-o-y.Exports and domestic sales have fared badly with the latter particularly affected. Poor domestic salesperformance is related to both the sharp slowdown in construction - particularly in the residential sectoras high interest rates deterred borrowing - and the decline in export-oriented industries such as theautomotive sector. Plans for an increase in steel prices from July indicate that the South African market may have reached itsbottom. ArcelorMittal South Africa (Amsa) announced that it intended to lift flats prices by 4.5% andlongs by 5-6% for its July deliveries. It said that the price revision was related to a more optimisticoutlook on global markets, despite South Africa’s economic recession. The price rise will be the firstsince September 2008. Since then, average South African steel prices fell by more than 60% until May2009, with prices unchanged in June. Nevertheless, BMI forecasts South African steel output of 6.77mn tonnes in 2009, down 18.1% and theworst annual performance for decades. This is an upward revision from the 6.24mn tonnes we forecast inthe previous quarter, with the upward trend in prices and a moderate recovery from end-2008 suggestingthat growth in steel output will resume in Q409 and not 2010 as we originally forecast. However, SouthAfrica is not expected to return to levels of production seen in 2006-2008 until at least 2012, if at all. Longs will perform better than flats, with rebar expected to be particularly strong. Despite the contractionin the construction sector in 2009, rebar production will post a strong recovery of nearly 16% growth in2010 and output rising above 890,000 tonnes in 2013, an increase of nearly 30% over 2008 levels.Domestic demand will not grow as fast as exports, with BMI expecting external markets to lead growthover the medium- to long-term. Domestic apparent steel use is forecast to reach 6.95mn tonnes in 2013(up 8.8% over 2008) while exports are expected to total 2.48mn tonnes (up 15.3%). Get Full Details About This Report >> |
|
|||
|
About MarketResearch.com
|
||||