Market situation and outlook

The market

According to the World Steel Association, global crude steel production for 2019 amounted to 1,849 (1,786) million tonnes, up 3.5% compared with the same period in 2018. Chinese steel production increased by 8% and steel production in North America by barely 1%, whereas production in the EU-28 decreased by close to 5% compared with the same period in 2018.

In North America, demand for heavy plate was generally good during the first half of the year. Demand weakened during the fall and distributors adopted a cautious sentiment in the wake of falling prices and reduced their inventories.

In Europe, demand was somewhat weaker throughout the year. During the first half of the year, it was primarily the Automotive segment that slowed down, but later demand also decreased in other segments, including Heavy Transport. During the fourth quarter, demand was marked by destocking both by end customers and distributors.

Demand for high-strength steel was good in most geographies during the year, but weakened in Europe and North America during the second half of the year.

In North America, market prices for heavy plate initially fell during the fourth quarter, but rose somewhat towards the end of the quarter. During the full year 2019, market prices fell sharply. In Europe, market prices for both strip and heavy plate fell during the year. During the fourth quarter, prices decreased during the first half of the quarter and then increased somewhat later in the quarter. In China, market prices for both strip and heavy plate increased during the quarter. For the year as a whole, prices for strip increased somewhat, whereas they were flat for heavy plate.

 

Market outlook

Outlook

In North America, demand for heavy plate is estimated to be stable during the first quarter of 2020. In Europe, underlying demand is expected to increase from a relatively low level during the fourth quarter of 2019, when both end customers and distributors destocked. Global demand for high-strength steels is expected to increase during the first quarter, primarily related to Europe. 

For SSAB Americas, shipments during the first quarter of 2020 are expected to increase compared with the fourth quarter of 2019, which was affected by the planned maintenance outage in Mobile. SSAB Europe and SSAB Special Steels are also expected to increase volumes compared with the fourth quarter of 2019.

Prices realized by SSAB Americas during the first quarter of 2020 are expected to be more or less unchanged compared to the fourth quarter of 2019. Prices realized by SSAB Europe and SSAB Special Steels are assessed to be somewhat lower during the first quarter of 2020.