Global steel output fall

Global crude steel dropped 8 per cent in 2009, in one of the worst downturns in its history, but analysts expect production to rise around 10 per cent this year as the $500 billion industry slowly recovers. The world produced 1.22 billion tonnes of crude steel in 2009, its lowest level since 1.144 billion tonnes in 2005, figures from the Brussels-based World Steel Association, whose members represent 85 per cent of steel output, showed on Friday. China strengthened its position as the world's top producer, with its production rising to a record high at 567.8 million tonnes. After last year's 13.5 per cent rise in its output, the country now accounts for 46.5 per cent of the world's total production and is set to be the engine of growth once again in 2010. 'Even at a modest growth rate of 8- 10 per cent, the impact on the global industry will be huge,' said John Lichtenstein, global leader of steel at Accenture. 'Global steel production and demand should rise by around 10 per cent in 2010 over 2009, bringing production back to the 2008 level of approximately 1.2 billion tonnes,' he said. Signs of recovery were evident in monthly figures from last year. In December, output rose by 30.2 per cent year-on-year to 106.4 million tonnes although they showed a slight fall compared with November's 117 million tonnes. Macquarie Bank expects crude steel production at 1.365 billion tonnes this year, citing a phase of restocking after a sharp destocking last year, which would boost production. The recovery of steel production and demand is set to vary greatly according to regions and the pace of growth could be faster in the developed world, which has seen falls of over 30 per cent in output last year. 'Mature economies will show a higher recovery rate in 2010, in the range of 12-15 per cent,' Accenture's Lichtenstein said. 'Because the acceleration of growth in the mature economies is from a very low consumption level, it will not be sufficient to close the