Executive Summary
The UK steel industry is the third largest in Europe, after Germany and
Italy. France is a close fourth, with these four countries making up some 84%
of output. The UK market is estimated at 13.1 million tonnes in 1995. Market
value in terms of price is difficult to estimate, but the apparent UK market is
estimated by Key Note to have been around £5.25bn in 1995. British Steel,
the largest steel company in the UK, and the third largest company in the world
by output in 1995, had a 1996 turnover of £7.85bn in the year to 1st April
1996.
This Key Note report replaces the Steel Stockholding title and covers the
entire steel market from producer to distributor. The report breaks the market
into product sectors as determined by European Coal and Steel Community (ECSC)
definitions and examines the market movements in terms of tonnage rather than
value, to remove distortions due to world price fluctuations.
The steel market has been affected by the recession, which shows signs of
continuing in many important end-customer industries, especially the
construction industry. On a global basis, there is overcapacity in the
industry, especially with the collapse of the former Soviet Union and the
release of its steel products onto the world market. China ceased purchasing
steel from the West in 1993, causing further over supply on the world market.
Destocking by consumers and producers alike has led to decreasing levels of
production in the past 2 years.
The stainless steel and alloy steel markets have been affected by steep price
rises in alloys in the past year, with, for instance, molybdenum increasing
over 600%, nickel doubling and vanadium trebling. The UK steel industry, which
is one of the lowest cost producers in the world, has been campaigning against
European Union (EU) subsidies and state aid for less efficient steel makers in
the rest of Europe. The industry has also been adversely affected by
antidumping and other tariffs in the US.
Slow growth is predicted for the UK steel industry over the next 2 years.
British Steel expects an end to stock run downs by German customers by the end
of summer 1996, with subsequent increases for UK exports. World steel prices,
which fell sharply in 1995, look set to recover slowly from their low of
December 1995. Key Note predicts a UK market tonnage of 14,250 tonnes in the
year 2000, compared to an estimated 13,100 in 1995.
Twelfth Edition 1996
Edited by Richard Caines
ISBN 1-85765-581-8
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