The drive to industrialisation in Asia has made it the region with the world’s highest steel production and demand. ISSB holds trade data at 6 digit HS tariff level for the dominant Asian steel nations: China, Japan, India, South Korea, Taiwan, Malaysia, Thailand, Indonesia, Philippines and Singapore, whom together produce 99.3% of the region’s steel. Additionally, with export coverage of 97% of steel production globally, ISSB is ideally placed to assess the market for steel in those Asian countries for which national trade data is not readily available, such as Vietnam and Pakistan.
Crude Steel Production
Asian steel output has been dominated by the development of Chinese steel production in recent years. The country accounted for just 39% of the region’s crude steel production in 2000 compared to 72% in 2015 and accounted for close to half of all world production. The big story in 2015 related to the deterioration of Chinese crude steel production down by 2.3%, the first reduction in recent history. This reduction was made in response to declining domestic demand. Reductions were also experienced in all the other major Asian countries with the exception of India. Indian output has grown rapidly in recent years with production of 27 million tonnes in 2000 surging to almost 90 million tonnes in 2015 reflecting a 2.6% growth over 2014.
World Steel Association crude steel production data for Asia is summarised below.
Trade in Steel
Asia contains some of the world’s largest steel exporting and importing nations.
Chinese steel exports have dominated headlines in recent years, not just because of the total tonnages being exported, but also due to their volatility. With Chinese production levels so high, even small changes in the proportion going to the domestic market can create export surges with serious implications for markets elsewhere. Over the past year, however, the slow-down in internal demand within the country has led to an unprecedented growth in Chinese exports, the impact of which is being felt across the world.
At the start of 2015, the traditional decline associated with the Chinese New Year holiday was exacerbated by the Government removing tax rebates for steel containing Boron. As the year progressed, exporters switched to other alloying elements in order to qualify for the export rebate. This export incentive together with deteriorating domestic demand gave rise to export levels peaking at 10.8 million tonnes in the month of September. Export volumes have since reduced a little but the 2015 figure of 107.3 million tonnes set a new record. Put in perspective, this level is greater than the combined annual production total for the US and Canada.
Compared to China, Japanese steel exports tend to be much more stable and up to 2010 this country was the largest exporter in the world before being overtaken by China in 2011. Like China, Japan meets most of its domestic steel requirements with limited imports.
Prior to the world economic downturn, South Korea was a net importer of steel. Since 2011, however, the country has changed to being a net exporter. After a growth in exports in 2014, shipments last year declined by 2% to leave the country as the third largest exporter in the world behind just China and Japan. Unlike those other two Asian powerhouses South Korea imported substantial quantities of steel. Despite falling by 3% year on year, the country remained the third largest global importer and the largest Asian importer of steel.
In addition to China, Japan and South Korea ISSB holds national trade data from the other major steel producing nations in Asia: India, Taiwan, Malaysia, Thailand, Indonesia, Philippines and Singapore.
Given our coverage which includes exports by countries producing 99% of the steel in Asia and 97% of steel produced globally ISSB is excellently placed to assess the markets for steel in countries, such as Vietnam, where national trade statistics are not readily available.