Alacero sees risks from Chinese steel industry

Thursday, 14 May 2020 14:17:56 (GMT+3)   |   Istanbul

According to data released by the Latin American Steel Association (Alacero), in the first quarter this year Latin American crude steel production fell by eight percent year on year, while output of rolled products declined by three percent when compared to the same period of the previous year. According to the association, exports decreased by 15 percent year on year in the January-February period of the year due to weak global steel demand.

Alacero stated that the apparent steel consumption of the region dropped by seven percent month on month and 2.5 percent year on year in February this year, while it fell by two percent year on year in the January-February period of the year. Alacero noted Argentina and Mexico as being among the countries most affected. The association expects apparent steel consumption in the region to total 55.4 million mt in 2020, decreasing by 13.8 percent or almost 8 million mt year on year.

Alacero CEO Francisco Leal said, "Parallel to this scenario, we see a rapid recovery in the Chinese steel industry and the continued risk it presents due to its overcapacity, where in the face of the sharp drop in world markets it will continue seeking to export its production to Latin America, which could make the recovery of the region even more difficult.”

The association also said that the collaboration of the steel industry is essential for a large number of value chains that are vital for society in these days in order to overcome the coronavirus crisis.

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