The International Stainless Steel Forum reports that first-quarter 2012 production of the high-value metal rose to 8.6 million metric tons, 2.7% over the previous quarter (Q4 2011), but output is down 2.8% versus the year-ago (Q1 2011) period. More important, the annual comparison shows output is down in all regions of the world, and down dramatically in North and South America.
Stainless steel is produced in much smaller volumes than carbon and other alloy steels, but the variety of its high-value applications (from automotive exhaust systems to aircraft and aerospace structures, architectural materials, medical/surgical equipment, and food and chemical process) make it an effective indicator of consumer and industrial investment trends worldwide.
The ISSF is a trade association for specialty steelmakers around the world. Its quarterly figures are preliminary.
The trade group noted that the 22% year-on-year production decrease in the Americas was the biggest regional decline for the current period. Total Q1 production in the region appears to have been 607,000 metric tons, which would be a 9% increase over the previous quarter’s report.
However, ISSF noted (without detail) that there are “discrepancies” in U.S. production data for raw stainless steel, which are being investigated.
China’s Q1 production total declined 5% from the fourth quarter of 2011 to the current period, from 3.6 million to 3.4 million metric tons, and dropped 1.2% versus the first quarter of 2011. Due to some changes in its reporting methods, ISSF is also noting some possibility of doubt about the Chinese data.
In the rest of Asia, stainless steel production increased 2.3% over the previous quarter, from 2.17 million to 2.2 million metric tons. That recent total indicates a year-on-year decrease of 0.6% for the current period.
The Western Europe/Africa region increased production 16.5%, from 1.9 million metric tons in Q4 2011 to 2.2 million metrics in the current period. That recent figure indicated a small (0.3%) decline versus Q1 2011.
Stainless production fell 9.8% to 76,000 metric tons in Central and Eastern Europe, from Q4 2011 to Q1 2012. The current figure is down 14.8% in the year-on-year comparison.
In all, however, ISSF stated its analysts do not expect the “negative growth rates” to continue throughout 2012, predicting that “real demand” and inventory building will drive production rates in the second half of this year. The group said it expects the annual production total to indicate “a slight increase on the record production level achieved in 2011.”