Posted on 01 Dec 2020
The Latin American steel market is optimistic regarding a recovery in 2021, following a contraction in 2020, Kallanish learns from regional steel producers’ association Alacero’s latest report.
“The Latin American steel market began this year with good expectations, but the coronavirus crisis resulted in low demand… By the end of this year crude steel production is expected to drop compared to 2019,” Alacero says.
Global steel demand has weakened amid the pandemic-induced crisis, sharply impacting consumption in Latin America.
“Unlike world consumption, which is expected to fall by -2.4% in 2020, the Latin American scenario shows a loss of competitiveness and space in greater added-value production. Regional output is threatened by the large volumes of steel offered from Asia, where countries resumed production at low prices compared to other regions,” the association comments.
It foresees that Latin American crude steel production will decrease by -10.4% on-year in 2020 to 54,393,000 tonnes. The association expects that finished steel output will reach almost 46.5 million tonnes, down -10.2% on-year. From this total, long products will amount to 22.3mt, down -12.6%. Flat steel production should reach 22.1mt, down -7.7%, while seamless tube is estimated to fall by -10.5% to 1.9mt.
Regional finished steel consumption is expected to amount to 58mt this year, down by -10.9% y-o-y.
According to Alacero, imports of steel products will fall -11.2% this year to 20.2mt. These will nevertheless represent 37% of regional apparent steel consumption, thereby creating disincentives to local industry, trade friction and unemployment threats, the association adds.
Latin America should end 2020 with 8.1mt of finished steel exports, -10.1% less on-year, while its steel trade deficit should reach 12.1mt, according to estimates.
Source:Kallanish
