By Paul Ploumis

SPOKANE (Scrap Monster): The latest statistics published by the Latin American Iron and Steel Institute (ALACERO) indicates that finished steel consumption by the Latin American and Caribbean region declined significantly during the initial ten months of the current year.

As per data, the apparent finished steel usage by the region totaled 51.4 million mt during the ten-month period from January to October this year, significantly down by 9% when matched with the corresponding period last year. The finished steel consumption for the month of October totaled 6.2 million mt. At the same time, finished steel production declined by 6% over the previous year during Jan-Oct ’16 to total 42.4 million mt.

The countries to record significant rise in finished steel consumption were Peru (up 200,000 mt, +9%), Mexico (up 179,000 mt, +1%) and Honduras (up 19,000 mt, +7%). On the other hand, the countries that recorded decline in consumption were Brazil (down 2.5 million mt, -14%), Argentina (down 989,000 mt, -23%), Chile (down 201,000 mt, -8%), Colombia (down 358,000 mt, -10%) and Ecuador (down 180,000 mt, -13%).

The trade data shows that the region reported annual deficit in finished steel trade during the initial ten-month period of the year. The deficit totaled 9.4 million mt, down by almost one-fourth when matched with the previous year. The largest finished steel trade deficit was recorded by Mexico (3.8 million mt). The other major countries to record deficit were Colombia (1.9 million mt), Chile (1.3 million mt) and Peru (1.3 million mt). The only country to register trade surplus during this period was Brazil. The country’s trade surplus stood at 2.9 million mt.

The finished steel consumption by the region had totaled 45.2 million tons during the first nine months of the year, down significantly by over 12% when matched with the previous year. Peru reported largest increase in apparent usage in absolute terms. The country’s consumption increased by 1.402 million tons year-on-year. The largest increase in apparent usage in percentage terms was by Honduras, which reported 11% jump in consumption during the initial nine-month period of the year. The consumption by Brazil dropped sharply by 16% when matched with the previous year. The other countries to report decline in finished steel consumption were Argentina (down 23%), Chile (down 8%), Colombia (down 6%) and Ecuador (down 24%).

Earlier during October this year, Alacero had stated that Latin American apparent steel consumption is likely to exceed 67 million mt during 2017, significantly higher when compared to 2016 levels. It must be noted that annualized steel usage for 2016 currently stands at around 62 million mt. The expected volumes are almost 4% above the 2016 estimates. The regional steel organization had stated that main regional markets are likely to witness growth in consumption. As per estimates, consumption by Argentina and Colombia is expected to grow by 5.8% and 3.9% year-on-year. Also, Brazil and Mexico are likely to post consumption growth of 3.8% and 3.2% respectively.

According to Alacero, the fragile economic situation in the Latin American region will see a positive turn in 2017. The global economic conditions are also likely to witness significant recovery during next year, it noted.