Q2 1012 apparent consumption down more than 12% YoY
Stocks reduced further
Demand seen falling almost 9% in 2012
Market to remain depressed well into 2013
Timid recovery in H2 2013
In Q2 2012, EU apparent steel consumption fell by more than 12% YoY as a result of the acceleration of the decline in real steel consumption and stock reductions in the distribution chain following the technical restocking in the 1st quarter of the year.
This rather sharp drop in apparent demand resulted in total demand falling by more than 10% in the 1st half of 2012. Due to a significant reduction in imports compared to the high volumes entering the EU market in the same period of 2011, the drop in EU mills' domestic deliveries remained limited to 7% in H1 2012.
Market fundamentals are expected to remain depressed well into 2013. Weak real steel consumption and further stock reductions in the steel distribution chain and at end users will result apparent steel consumption levels which are now forecast to be even lower than those registered in the 2nd half of 2011. On balance, apparent steel demand is expected to drop around 8.5% YoY in 2012.
The outlook for 2013 is overall bleak, but with probably a slight improvement in market fundamentals over the year. Early 2013, inventories will be extremely low due to three subsequent quarters of destocking in 2012. Some technical restocking appears to be inevitable in the first half of the year, without having a noticeable effect on overall stock levels and real and apparent steel consumption remaining very well aligned. Weak real steel consumption will keep apparent demand below the corresponding 2012 volumes.
The expected slight improvement in activity of the steel using sectors and therefore in real steel consumption should translate in a slight rise in apparent steel demand in H2 2013. On balance, apparent consumption is foreseen to rise by almost 1% in 2013.
EU Apparent Consumption
In million tonnes per annum
