On October 4 at the SteelOrbis Fall '10 Conference & 63rd IREPAS Meeting held in Madrid
Andrés Barceló, director general of Spanish steel producers' association UNESID, said that steel production and the steel market will be led mainly by Asia, while the European Union economy is recovering, but at a very slow pace, led by exports. Mr. Barcelo remarked that construction activity in Europe is likely to suffer more from budget cuts and lack of consumer confidence and thus domestic production of rebar and wire rod shall supply a significant share to the export market.
In his presentation, Mr. Barcelo indicated that the apparent steel usage increases will be higher in the Americas, Europe and in the CIS, compared to Asia, the Middle East and Africa, due to the extremely low levels reached in 2009 in advanced economies, underlining that Asian and Chinese apparent steel use will continue to grow, by 7.5 percent and over 15 percent respectively.
Regarding the European steel market, Mr. Barcelo indicated that the European economy is expected to grow at a modest pace, by 1.9 percent this year and by 1.8 percent in 2011, while the unemployment rate remains very high, over nine percent this year and at 8.1 percent in 2011, limiting private spending and thus pushing down demand.
European construction investments, which shape long steel demand in the region, will continue dropping in 2010, by 1.4 percent, Mr. Barcelo said, adding that spread budget cuts will harm the civil engineering sector and that residential construction will remain weak all over Europe.
The director general of UNESID explained that European rebar production, with a monthly average of 1.29 million metric tons in the first half of this year, down from 1.42 million metric tons in 2009, is driven by exports. Among the major export destinations of European rebar mills, Algeria has a share of 50.2 percent.
In the first half of this year, average European monthly wire rod production again almost reached 2007 levels, amounting to 1.9 million metric tons, Mr. Barcelo remarked, adding that wire rod production is also driven by exports, with the US having the largest share at 16.2 percent, followed by Turkey at 15.4 percent and Algeria at 15.1 percent.
Finally, Andrés Barceló stated that in the first half of 2010 long product supplies in the European Union rose by 10.8 percent, thanks to a 21.6 percent increase in wire rod supplies, compared to a 10.8 percent drop in rebar supplies.