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Low impact on global steel trade ¨C Kotak Institutional Equities Research- The 19th China£¨Guangzhou£©Int¡¯l Sheet metal machinery,Forging, Stamping and Setting Equipment Exhibition
3/7/2018 Sheetmetal machinery, Forging, Stamping expo |
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Kotak Institutional Equities Research in a research note said that steel can result in decline in exports to US by close to 9-14 million tons; low direct impact per se. It said ¡°We estimate that steel exports to US by other countries can decline by 9-14 million tons due to imposition of higher import duties and ramp-up in its domestic steel mill utilization rates by 80-85%, from 72% at present. The US produced 82 million tons of steel in 2017 on capacity on 113 million tons and imported 36 million tons of steel. The imports can fall to 22-25 million tons if US steel production increases to 91-96 million tons assuming mill utilizations improve to 80-85%. The largest steel exporters to US include Canada, Brazil, South Korea, Mexico and Russia which together account for close to 60% exports to the US. India exported close to 0.9 million tons of steel to the US in 2017.¡±
It said ¡°We expect a low direct impact of US trade protection on the global steel markets, 9-14 million tons is close to 2-3% of global steel trade of 460 million tons and 0.6-0.9% of the global steel demand. We believe this disruption can be absorbed by improvement in China¡¯s domestic steel mill utilizations and falling exports (-30% in 2017) as it remains a dominant producer, consumer and exporter of steel globally thereby influencing regional steel prices. We expect China capacity utilization to improve to 82% in 2018 led by additional mill closures after utilizations improved to 80% in 2017, especially led by closure of induction furnaces.¡±
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The 19th China£¨Guangzhou£©Int¡¯l
Sheet metal machinery,Forging, Stamping and Setting Equipment Exhibition
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