Author: Paul Ploumis20 Nov 2014 Last updated at 00:33:57 GMT
BRUSSELS (Scrap Monster): In its latest research report, Moody’s has predicted modest recovery for EU stainless steel market in 2015. The stainless steel production by the region is likely to increase during next year. The rise in cheap imports of stainless steel products from China and Taiwan are likely to limit hike in stainless steel prices.
The improving economic situation across EU region countries is likely to instill consumer confidence. The report forecasts increased demand for stainless steel finished products from wide range of sectors including automotive, consumer goods, medical equipment and construction. The increased demand may fuel higher capacity utilizations by mills. The capacity utilization by EU stainless steel mills are likely to grow from current levels of 75% to 80% in 2015.
According to Moody’s, the restructuring efforts undertaken by major EU mills during last year will pay off in 2015. ThyssenKrupp has already announced major streamlining plans for the year ahead. Outokumpu too has announced planned closure of Bochum melt shop facility in August 2015. The company had curtailed its production capacity by 6 million tonnes during this year. The tightened supply and increased demand may lead to higher product prices. Major firms expect the base prices of stainless steel products to see significant improvement over the next 12 months.
However, increased imports from Asia will dampen the prospects of any price increase. Moody’s see very less possibilities of imports slowing down during the rest of the year. Meanwhile, imposition of higher anti-dumping duties on imported products from Asian countries, especially from China and Taiwan, may benefit European stainless steel producers.