Kosei Shindo calls for extension of Global Forum on Steel Excess Capacity

Tuesday, 16 October 2018 11:11:18 (GMT+3)   |   Istanbul
       

In his chairman’s address at the 52nd annual meeting of worldsteel (World Steel Association) held in Tokyo on October 16-17, Kosei Shindo, chairman of worldsteel as well as president of Japanese steelmaker Nippon Steel & Sumitomo Metal Corporation (NSSMC), began by saying that the business environment surrounding the world steel industry is favorable in general, with demand for steel growing gradually and continuously against the backdrop of a strong world economy, though he also added that there are many uncertainties in the macroeconomic environment, such as increasing world trade tensions or the issue of the UK’s negotiations for the withdrawal from the EU, with close attention needing to be paid to how these risks will affect future trends.

Looking at the steel industry’s customer industries, he commented that it could be said that they are in a time of huge change. In the automotive industry, a major customer, technological innovations are being introduced, including the development of electric vehicles and automated driving technology. The worldsteel chairman said that the steel industry must appropriately and rapidly respond to such changes through innovations by applying dramatically progressing information technologies, such as big data analysis or artificial intelligence, as well as developing “multi-material” technology and so on. He also said that the high target for the reduction of CO2 emissions which was set as a measure against global warming in the Paris Agreement is a very big challenge for the steel industry.

Mr. Shindo then turned to focus on several important issues and the direction that the steel industry, he said, is taking and should take in the future to resolve these issues.

First, the Global Forum on Steel Excess Capacity (GFSEC) was set up in 2016. Under the initiative of this forum chaired by Germany and Argentina and with the accumulated efforts of each country, the transparency of the steel supply-demand environment has improved in the past two years following the establishment of the forum. Mr. Shindo said that the multilateral approach by the Global Forum to exchange information on crude steel capacity developments and government policies affecting excess capacity, including market-distorting subsidies and other government support measures, have been effective to date, while he expressed his satisfaction that the ministerial meetings held in September 2018 agreed to them, going on to say that he hoped for further progress through the smooth implementation of agreements next year under Japan’s chairmanship of the forum. Although the forum reaches its initially-set expiry date in 2019, he said that the majority of worldsteel members would like to see the Global Forum process continued after the expiration of the first three-year term. This continuation together with the steel industry’s contribution to building free and fair steel trade will help to ensure the sustainable development of the industry. In the meantime, he continued, trade tensions are increasing around the world in the wake of the recent invocation of Article 232 of the Trade Expansion Act by the United States. He stressed that the world steel industry must pay close attention, not only to the direct impact of the invocation, but also to the indirect impact of the expanded application to automobiles and related parts, as well as to the chilling effects on trade and investment caused by trade restrictions imposed by each country as countermeasures. He stressed that the fair and free trade system has served as the basis for the development of the world economy and expressed the hope that such trade issues will be properly handled.

The second issue, the worldsteel chairman said, is how to tackle global warming. Worldsteel, he stated, has analyzed the impact of global warming issues on the steel industry and discussed the direction that the industry should take. Currently, worldsteel, he said, is working to improve energy efficiency and to reduce CO2 emissions by applying top 15 percent-level technologies that lead the world’s steel industry to the members of worldsteel. He continued by saying that it is also important to promote educational activities from the perspective of life-cycle assessment in order to improve the image of steel as an environmentally-friendly material. To take the next step, innovation is important, he affirmed.

The third issue, Mr. Shindo said, is the analysis of long-term forecasts for steel supply-demand and initiatives for new market development based on these forecasts. Last year, worldsteel compiled a future forecast analysis of the steel industry, setting 2035 as the goal, although there are many uncertainties that may affect supply and demand for steel. Producing such long-term supply-demand forecasts will contribute to the future stabilization of the steel product market, he stated, going on to say that worldsteel is also working actively on the research of various demand areas, such as establishing “constructsteel”, which is designed for research of construction market development, in addition to the future trend survey of the automotive industry that has been conducted by WorldAutoSteel. He said worldsteel will continue to share beneficial knowledge and promote research that will contribute to the growth of the steel industry.

In conclusion, the worldsteel chairman said the association will continue to actively develop activities that are beneficial to member companies and make efforts to support the development of the world steel industry.

 


Most Recent Related Articles

Turkey’s merchant bar prices increase slightly

Long-standing stability of local Turkish scrap prices comes to an end

Ex-US scrap prices in Turkey move up in new deals

Turkey’s ship scrap purchase prices increase on the lower end

Ugur Dalbeler: Turkish exporters to seek new markets, will face Russian competition