08-Dec-2011

1

Introduction to some

steel and raw material

developments

Workshop on steelmaking raw materials

5 December 2011

1. The fast expansion of the steel industry during last decade

2. Developments in the key steelmaking raw materials during the last decade

3. International trade of the key steelmaking raw materials

4. Issues related to steelmaking raw materials availability

08-Dec-2011

2

Fast steel market expansion since the start of this century

• Urbanization and growth of populations

• Investment and industrialisation in emerging economies

• Expanding the capital stock for output and employment growth

• Rising household incomes strengthen the demand for steel-intensive consumer items

Post 2010

expansion?

Large contribution of Chinese steel industry

0

100

200

300

400

500

600

700

800

900

1000

Rest of the World

China

Steel production (annualized, mmt)

Source : World Steel Association

08-Dec-2011

3

World production: steel, iron ore, coking coal

Sources: World Steel Association, UNCTAD, IEA

0

200

400

600

800

1000

1200

1400

1600

1800

2000Iron ore

Coking coal

Steel

mmt

CAGR 98-2010

Steel

5.2%

Iron ore

6.0%

Coking coal

5.1%

World exports

CAGR 98-2010

Steel

(production)

5.2%

Iron ore

7.2%

Coking coal

3.3%

0

200

400

600

800

1000

1200

1400

1600

iron ore

coking coal

steel (production)

mmt

08-Dec-2011

4

Chinese imports

0

100

200

300

400

500

600

700

Iron ore

Coking coal

Steel (production)

mmt

Largest trade flows: iron ore

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5

Largest trade flows: coking coal

Summary observations

• The health of the steel industry is linked to the development of the mineral and other raw material sectors;

• Most economies are not self-sufficient in steel raw materials and rely on imports;

• The need for free and uninterrupted flow of raw material supplies on world markets;

• Need to explore the market and policy factors that may improve the free flow of raw materials for steel and other manufacturing sectors.

08-Dec-2011

6

Size of the international markets of

steelmaking raw materials

Raw material

World exports

(mmt)

World exports

(billion USD)

Average

unit value

(USD/tonne)

Largest exporter

(tonnage share)

Largest importer

(tonnage share)

Iron ore 1,043 103.0 98.8 Australia

(41%)

China

(57%)

Coking Coal 271 47.7 a/

176.2 a/

Australia

(57%)

Japan(21%)

Ferrous Scrap 95 42.9 451.6 United States

(21%)

Turkey

(21%)

Sources: ISSB, IEA and OECD.