The steel industry in Europe is expected to grow in 2007 albeit at a slower rate than in 2006, according to the projections of Eurofer (European Confederation of Iron and Steel Industries).
For Q1 and Q2 2007, Eurofer forecasts positive year on year growth for all steel-consuming industries, with the notable exception of the automotive industry for which respective drops of 0.9 and 0.4 percent are predicted for the first two quarters of the year.
The respective year on year Q1 and Q2 2007 growth percentages predicted for the major steel-using industries in Europe are construction (3.8, 2.4), structural steelwork (5.4, 4.6), mechanical engineering (4.1, 3.8), domestic appliances (2.8, 2.5), shipyard (1.5, 3.1), tubes (4.0, 3.2), metalware (3.2, 3,7), and miscellaneous (3.4, 2.6). The respective 2007 full year growth predictions for the above industries are 3.0, 4.1, 3.4, 4.5, 5.2, 2.4, 1.9 and 1.8 percent.
Eurofer remarks that the notewothy feature in the European steel industry in H1 2007 is the continuation of growth following upon the high levels recorded in 2006. With the exception of the automotive sector, the Eurofer report says that all the steel-consuming industries seem to be benefitting from strong order intake and solid output growth. It also states that “investment levels remain key and continued robust confidence indices are a good sign that expectations are positive.”
As regards the real consumption of the European steel industry, from year on year growth of 5.9 percent in 2006, the growth rates for Q1 and Q2 2007 have been projected as 2.4 percent and 1.4 percent respectively, with the 2007 full year figure predicted at 2.3 percent. Meanwhile, European steel industry apparent consumption, which increased 10.9 percent year on year in 2006, is predicted to grow 3.3 percent, -0.7 percent, and 0.6 percent respectively for Q1, Q2 and the full year of 2007.
Eurofer’s latest steel industry report predicts a “broadly steady” trend for EU25 steel exports in 2007, up just 1.3 percent on 2006. However, Eurofer sounds a more ominous note as regards the massive increase in EU25 steel imports in 2006 – up by over 50 percent, much of this coming from China. Though an average rise of just 2.7 percent is predicted for EU25 steel imports in 2007 compared to 2006, Eurofer warns, “The situation remains tense, with import volumes continuing to be disruptive particularly in southern Europe. Trade action is not excluded at some stage this year.”