Global steel industry trends
Encyclopedia
The global steel
industry has been going through major changes since 1970. China
has emerged as a major producer and consumer, as has India
to a lesser extent. Consolidation has been rapid in Europe.
Steel is made from ores still found in abundance around the world. Technological developments have brought down the time for transformation from iron ore to steel to within a day. Even after decades of use, it can be sent back to the furnaces as scrap, melted and remade into new qualities of steel. It is the most recycled material in the world. In developed countries, recycling accounts for almost half of the steel produced.
Another major feature is the continuous improvement of steel grades. Half of today’s steel grades were not available ten years ago. Just take the example of the most commonly used steel – rods or bars, used as reinforcement material with cement concrete. It used to be plain bars even in the sixties, then came the ribbed bars, followed by the cold twisted deformed bars and now it is thermo mechanically treated bars. Each development has added to the strength of construction. Older varieties of steel have been improved upon and newer grades introduced. The process continues.
Over the course of the 20th century, production of crude steel has risen at an astounding rate, now fast approaching a production level of 800 million tons per year. Today, it is difficult to imagine a world without steel.
During the 20th century, the consumption of steel increased at an average annual rate of 3.3%. In 1900, the USA was producing 37% of the world’s steel. With post war industrial development in Asia that region now (at the turn of the 20th century) accounts for almost 40%, with Europe (including the former Soviet Union) producing 36% and North America 14.5%.
Steel consumption increases when economies are growing, as governments invest in infrastructure and transport, and build new factories and houses. Economic recession meets with a dip in steel production as such investments falter.
After being in the focus in the developed world for more than a century, attention has now shifted to the developing regions. In the West, steel is referred to as a sunset industry. In the developing countries, the sun is still rising, for most it is only a dawn.
Towards the end of the last century, growth of steel production was in the developing countries such as China, Brazil and India, as well as newly developed South Korea. Steel production and consumption grew steadily in China in the initial years but later it picked up momentum and the closing years of the century saw it racing ahead of the rest of the world. China produced 220.1 million tonnes in 2003, 272.2 million tonnes in 2004 and 349.36 million tonnes in 2005. That is much above the production in 2005 of Japan at 112.47 million tonnes, the USA at 93.90 million tonnes and Russia at 66.15 million tonnes. For details of country-wise steel production see Steel production by country
.
In the developed countries, the trend is on consolidation of industry. Cross-border mergers have been taking place for several years. The focus is on technological improvements and new products.
Globally, the steel industry became a billion tonne industry in 2004. How much more it will grow will depend primarily on how much more steel is consumed in the developing countries.
The third quarter of the twentieth century witnessed massive growth of the global steel industry. Annual production rose more than three times in 15 years from 1960. In the last quarter of the century, production reached a plateau, rising only by around 100 million tonnes. Increase in production gave way to increases in productivity. See also steel crisis
.
During the period 1974 to 1999, the steel industry had drastically reduced manpower all around the world. In USA, it was down from 521,000 to 153,000. In Japan, it was down from 459,000 to 208,000. In Germany, it was down from 232,000 to 78,000. In UK, it was down from 197,000 to 31,000. In Brazil, it was down from 118,000 to 59,000. In South Africa, it was down from 100,000 to 54,000. South Korea already had a low figure. It was only 58,000 in 1999. The steel industry had reduced manpower around the world by more than 1,500,000 in 25 years.
(1) Includes former German Democratic Republic 1996-2000
(2) Serbia and Montenegro 1996-2000
(3) 1975 total
Totals are rounded. United States figures are average for 12 months. Various other differences in coverage and definition exist, so that inter-country comparisons are of dubious value. E indicates estimate.
Steel
Steel is an alloy that consists mostly of iron and has a carbon content between 0.2% and 2.1% by weight, depending on the grade. Carbon is the most common alloying material for iron, but various other alloying elements are used, such as manganese, chromium, vanadium, and tungsten...
industry has been going through major changes since 1970. China
China
Chinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...
has emerged as a major producer and consumer, as has India
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
to a lesser extent. Consolidation has been rapid in Europe.
Material for development and war
The volume of steel consumed has been the barometer for measuring development and economic progress. Whether it is construction or industrial goods, steel is the basic raw material. Lighter metals and stronger alloys have been developed. Plastics and synthetics have replaced steel in many areas.Steel is made from ores still found in abundance around the world. Technological developments have brought down the time for transformation from iron ore to steel to within a day. Even after decades of use, it can be sent back to the furnaces as scrap, melted and remade into new qualities of steel. It is the most recycled material in the world. In developed countries, recycling accounts for almost half of the steel produced.
Another major feature is the continuous improvement of steel grades. Half of today’s steel grades were not available ten years ago. Just take the example of the most commonly used steel – rods or bars, used as reinforcement material with cement concrete. It used to be plain bars even in the sixties, then came the ribbed bars, followed by the cold twisted deformed bars and now it is thermo mechanically treated bars. Each development has added to the strength of construction. Older varieties of steel have been improved upon and newer grades introduced. The process continues.
Growth of the industry
Global steel production grew enormously in the 20th century from a mere 28 million tonnes at the beginning of the century to 781 million tonnes at the end.World Steel Production in the 20th Century
During the 20th century, the consumption of steel increased at an average annual rate of 3.3%. In 1900, the USA was producing 37% of the world’s steel. With post war industrial development in Asia that region now (at the turn of the 20th century) accounts for almost 40%, with Europe (including the former Soviet Union) producing 36% and North America 14.5%.
Steel consumption increases when economies are growing, as governments invest in infrastructure and transport, and build new factories and houses. Economic recession meets with a dip in steel production as such investments falter.
After being in the focus in the developed world for more than a century, attention has now shifted to the developing regions. In the West, steel is referred to as a sunset industry. In the developing countries, the sun is still rising, for most it is only a dawn.
Towards the end of the last century, growth of steel production was in the developing countries such as China, Brazil and India, as well as newly developed South Korea. Steel production and consumption grew steadily in China in the initial years but later it picked up momentum and the closing years of the century saw it racing ahead of the rest of the world. China produced 220.1 million tonnes in 2003, 272.2 million tonnes in 2004 and 349.36 million tonnes in 2005. That is much above the production in 2005 of Japan at 112.47 million tonnes, the USA at 93.90 million tonnes and Russia at 66.15 million tonnes. For details of country-wise steel production see Steel production by country
Steel production by country
This article summarizes the world steel production by country. For the company-oriented account, see List of steel producers.In 2010, total world crude steel production was 1,413.6 million metric tonnes . The biggest steel producing country is currently China, which accounted for 44.3% of world...
.
Growth potential of the industry
Amongst the other newly steel-producing countries, South Korea has stabilised at around 46-48 million tonnes, and Brazil at around 30 plus million tonnes. This brings the focus of the industry to India. Considering a steel consumption of 300 kg per man per year to be a fair level of economic development, India will have to come up to somewhere around 300 million tonnes, if it is to fulfil its ambitions of being a developed country. That of course is a long journey from the present production level of around 50 million tonnes but one must consider its past before coming to a conclusion about its potential. India was producing only around a million tonnes of steel at the time of its independence in 1947. By 1991, when the economy was opened up steel production grew to around 14 million tonnes. Thereafter, it doubled in the next 10 years, and then it is doubling again, maybe over a slightly longer span. Steel Production in India is expected to reach 124 million tons by 2012 and 275 million tons by 2020 which could make it the second largest steel maker. http://www.business-standard.com/common/storypage_c_online.php?leftnm=11&bKeyFlag=IN&autono=30054In the developed countries, the trend is on consolidation of industry. Cross-border mergers have been taking place for several years. The focus is on technological improvements and new products.
Globally, the steel industry became a billion tonne industry in 2004. How much more it will grow will depend primarily on how much more steel is consumed in the developing countries.
Reduction in workforce
Steel is no more the labour-intensive industry it used to be. Earlier, it was often associated with the image of huge work force living in a captive township. All that has changed dramatically. A modern steel plant employs very few people. In South Korea, Posco employs 10,000 people to produce 28 million tonnes. As a rule of thumb, one can put the direct employment potential at 1,000 per million tonnes. It could be less. However, steel being a basic industry, it generates substantial growth of both upstream and downstream facilities. According to some estimates one person-year of employment in the steel industry generates 3.5 person-years of employment elsewhere. Considering all these, total employment generation will be substantial.The third quarter of the twentieth century witnessed massive growth of the global steel industry. Annual production rose more than three times in 15 years from 1960. In the last quarter of the century, production reached a plateau, rising only by around 100 million tonnes. Increase in production gave way to increases in productivity. See also steel crisis
Steel crisis
The steel crisis was a recession in the global steel market during the 1970s recession, following the end of the post-World War II economic boom and the 1973 oil crisis....
.
During the period 1974 to 1999, the steel industry had drastically reduced manpower all around the world. In USA, it was down from 521,000 to 153,000. In Japan, it was down from 459,000 to 208,000. In Germany, it was down from 232,000 to 78,000. In UK, it was down from 197,000 to 31,000. In Brazil, it was down from 118,000 to 59,000. In South Africa, it was down from 100,000 to 54,000. South Korea already had a low figure. It was only 58,000 in 1999. The steel industry had reduced manpower around the world by more than 1,500,000 in 25 years.
Employment in the steel industry 1974, 1990 and 1996-2000
Thousand at end of year| Country | 1974 | 1990 | 1996 | 1997 | 1998 | 1999 | 2000 |
|---|---|---|---|---|---|---|---|
| Austria | 44 | 21 | 13 | 12 | 12 | 12 | 12 |
| Belgium | 64 | 26 | 23 | 21 | 20 | 20 | 20 |
| Denmark | 2 | 1 | 1 | 1 | 1 | 1 | 1 |
| Finland | 12 | 10 | 7 | 7 | 8 | 7 | 8 |
| France | 158 | 46 | 39 | 38 | 38 | 38 | 39 |
| FR Germany (1) | 232 | 125 | 86 | 82 | 80 | 78 | 77 |
| Greece | 0 | 3 | 2 | 2 | 2 | 2 | 2 |
| Ireland | 1 | 1 | 0 | 0 | 0 | 0 | 0 |
| Italy | 96 | 56 | 39 | 37 | 39 | 39 | 39 |
| Luxembourg | 23 | 9 | 5 | 5 | 4 | 4 | 4 |
| Netherlands | 25 | 17 | 12 | 12 | 12 | 12 | 12 |
| Portugal | 4 | 4 | 2 | 2 | 2 | 2 | 2 |
| Spain | 89 | 36 | 24 | 23 | 22 | 22 | 22 |
| Sweden | 50 | 26 | 14 | 14 | 14 | 13 | 13 |
| United Kingdom | 197 | 51 | 37 | 36 | 34 | 31 | 29 |
| European Union | 996 | 434 | 306 | 293 | 290 | 280 | 278 |
| Yugoslavia (2) | 42 | 69 | 17 | 17 | 17 | 15 | 15 |
| Canada | 77 | 53 | 53 | 53 | 55 | 57 | 56 |
| United States | 521 | 204 | 167 | 163 | 160 | 153 | 151 |
| Brazil | 118 | 115 | 79 | 74 | 63 | 59 | 63 |
| South Africa | 100 | 112 | 71 | 70 | 61 | 54 | 56 |
| Japan | 459 | 305 | 240 | 230 | 221 | 208 | 197 |
| Republic of Korea | n/a | 67 | 66 | 64 | 59 | 58 | 57 |
| Australia | 42 | 30 | 21 | 20 | 20 | 24 | 21 |
| World Production | 644 (3) | 770 | 750 | 799 | 777 | 789 | 848 |
(1) Includes former German Democratic Republic 1996-2000
(2) Serbia and Montenegro 1996-2000
(3) 1975 total
Totals are rounded. United States figures are average for 12 months. Various other differences in coverage and definition exist, so that inter-country comparisons are of dubious value. E indicates estimate.