SMEs restrained by lower utilisation of installed steel capacity
The global Crude steel production at 1,809 MT in 2018, indicating 4.6% growth over last year, can be considered a reasonably good performance, particularly in the context of falling trend of market expansion in the EU, Japan, South Korea and CIS countries. On account of Anti Trust guidelines, WSA has not been providing capacity utilisation ratio, leaving it to the wisdom of OECD Steel Committee which has last published global capacity data for 2017 (estimated). Thus, assuming that capacity closure by China (net capacity replacement figures) in 2018 is balanced by fresh capacity augmentation by India, Iran, Vietnam and other countries, the OECD figure of global capacity at 2,251 MT for 2017 can be taken for 2018 as well and accordingly the current global capacity utilisation ratio comes to a healthy 80.4%.
Regionwise, while EU-28 has produced steel lower than last year, Nafta has produced 4.1% more and Asia has rolled out 5.6% more steel in 2018 with CIS countries almost equalling last year’s level. India has surpassed Japan to become the second-largest steel producer. It is important to note that belying all the projections by reputed agencies and the media, China at 928.3 MT has exhibited a 6.6% growth in crude steel production and the gap between India and China at 822 MT has become still larger. In December 2018 itself, China produced 76.1 MT of crude steel which exceeds last year’s December production by 8.2%.