|
|
 |
|
Viewing report
|
|
|
|
Belgium Metals Report Q3 2009
Business Monitor International, July 2009, Pages: 43
The Belgium Metals Report provides industry professionals and strategists, corporate analysts, metals associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Belgium's metals industry
The Belgian steel industry has entered a prolonged and deep decline and the latest Belgium Metals Report does not envisage a return to pre-recession levels over the next five years. In the first five months of 2009, Belgian crude steel production fell 65% y-o-y to 1.77mn tonnes. Although monthly output in May – at 440,000 tonnes – was nearly 90% above the February low-point of 235,000 tonnes, it was still down 60% year-on-year (y-o-y). Output is at lows not seen for decades. The reports attributes the modest upturn in 2009 to small purchases for restocking rather than a recovery in demand for steel products.
Industrial sectors that are suffering the most include the automotive and construction industries, both of which are major users of Belgium’s steel output. The lack of confidence in the housing market – unsurprising given the Europe-wide property slump and the lack of available credit – is illustrated by figures for gross fixed capital formation (GFCF). Investment in housing was flat y-o-y in late 2008. We expect housing market woes to add to negative consumer sentiment in 2009. Indicators from the central bank add additional weight to our bearish view on private consumption. Additionally the slump in European car sales has had a negative impact on the automotive industry’s supply chain and therefore demand for steel. Belgium hosts five car assembly plants, six truck manufacturers and more than 300 suppliers, with more than 96% of output dedicated to export markets.
ArcelorMittal’s Gent and Liège plants are highly reliant on the automotive industry and are set to suffer the most from the collapse in European car sales. With total production capacity of 10mn tonnes per annum (tpa) of continuous casting slab and 8.5mn tpa of hot rolling mill capacity, cuts in ArcelorMittal’s output will have a severe negative impact on steel production in 2009. Signs of a deep decline in output have already been witnessed. In November 2008, ArcelorMittal Liège idled one of its two blast furnaces at its Seraing site with a view to restarting them after a two month period. In January 2009, it announced that the 1.5mn furnace would not be brought back online in H109. A furnace at the Ougrée site was brought back into operation in mid-January, after a month’s stoppage. The three plants under the control of the Russian-Belgian joint venture Steel Invest and Finance will also face major difficulties, although they are less dependent on the automotive industry. Yet they have also experienced drastic cuts in output, with Belgian joint venture partner Duferco Belgium cutting production by about 30% in Q408, with cuts totalling 50% at La Louvière in Q109.
Belgium’s recession showed no sign of abating in Q209, forecasting a contraction of 2.4% in 2009, the first full-year recession for more than a decade. Amid this gloom, the report forecasts a 45% drop in crude steel output due to a fall in hot-rolled production downstream, particularly flats which will be depressed by the effects of the collapse in the automotive industry. While Belgium is unlikely to see the kind of monthly output reported in Q1, any growth will largely be the result of inventory building. Actual demand growth is not expected until Q210, with 2010 output set to rise by around 11% above 2009 levels, although this is still a low level.
We do not believe that annual steel production will exceed 9mn tonnes again until 2013. The decline in output is related to the collapse in the export market, which is set to fall 38% to 13.6mn tonnes in 2009. At the same time, the import market will fall by around 43% to just under 9.0mn tonnes. The value of net exports will fall from US$10.2bn to US$5.4bn.
Product samples
A sample for this product is available. Please Login/Register to download this sample.
Customers who bought this item also bought
Belgium Metals Report Q4 2009
Romania Metals Report Q4 2009
Spain Metals Report Q4 2009
Germany Metals Report Q4 2009
Germany Metals Report Q3 2009
France Metals Report Q4 2009
Spain Metals Report Q3 2009
Mexico Metals Report Q4 2009
Poland Metals Report Q3 2009
Netherlands Metals Report Q4 2009
Ukraine Metals Report Q4 2009
Japan Metals Report Q4 2009
|
|
|
|
