Belgium Metals Report Q1 2013
- ID: 2373678
- January 2013
- Region: Belgium
- 49 pages
- Business Monitor International
BMI's Belgium Metals Report for Q113 examines the long-term effects of the economic crisis on the country's steelmaking capacities and warns that the sector will never recover.
The report examines how a collapse in domestic production will impact on the country's structure of steel trade and explores the ability of exporters to take advantage of the crisis facing the Belgian steel industry.
In the first 10 months of 2012, Belgian crude steel output slumped 12.9% y-o-y to 6.11mn tonnes (mnt),
one of the worst performances in the EU. This continued a trend begun in Q411 and reverses the gains witnessed in the early months of 2011 when capacity utilisation rates were returning to near pre-crisis levels. Permanent furnace closures by Duferco and ArcelorMittal mean that Belgium will not return to pre-crisis volumes of production even after the market picks up.
A decline in demand growth in export markets has dealt a blow for the Belgian steel industry.
ArcelorMittal's planned permanent closure of two blast furnaces in Liège, which were shuttered in August 2011, is now inevitable and as a result the industry will not return to pre-2008 levels of production.
Duferco has permanently closed its Carsid site after talks with potential takeover candidates failed. This will permanently remove the 2.1mntpa of slab capacity that had been taken offline in 2008. It also ended Duferco's crude steelmaking activities in Belgium.
- Low domestic consumption growth and a poor export environment combined with idling of blast furnaces confirms our forecast of a 10% contraction in crude steel output to 7.3mnt in 2012.
BMI believes that it is unlikely that crude steel output will exceed much beyond 8mntpa over the long-term due to capacity closures, down over a quarter from the pre-2008 levels.
- The World Steel Association's (WSA) revised figures for 2010 and 2011 show lower than estimated levels of consumption, prompting a downward revision in BMI's forecast for 2012 from 4.5mnt to 4.2mnt, although we maintain our growth forecast of -10% given the strongly pro-cyclical nature of the Belgian steel market.
- BMI believes that it is unlikely that crude steel output will exceed much beyond 8mntpa over the long-term due to capacity closures, down over a quarter from the pre-2008 levels. SHOW LESS READ MORE >
Executive Summary 5
SWOT Analysis 6
Belgium Metals Industry SWOT 6
Europe Metals Overview 7
Industry Forecasts 13
Table: Belgium - Steel Production & Consumption ('000 tonnes, unless stated otherwise) 14
Table: Belgium- Steel Industry Historical Data ('000 tonnes, unless stated otherwise) 15
Macroeconomic Outlook 16
Sliding Into Recession 16
Table: Belgium - Economic Activity 18
Commodities Forecast 19
Monthly Metals Update 19
Iron Ore: Temporary Resilience 21
Steel: No Sustained Recovery 23
Aluminium: Resistance To Be Tested 25
Copper: Chinese Stockpiles Present Downside Risk 26
Lead: Range-Trade Ahead 27
Tin: Continued Outperformance 29
Zinc: Little Room For Optimism 30
Table: Select Commodities: Performance & BMI Forecasts 31
Steel Forecast 32
Steel To Average US$360/tonne In 2013: Short-Term View 32
Table: Steel Forecast 32
Table: Steel Forecasts 38
Competitive Landscape 39
Company Profiles 40
Table: Alcoa - Financial Data 43
Table: ArcelorMittal - Key Financial Data 46
BMI Methodology 48
How We Generate Our Industry Forecasts 48
Cross Checks 48