Chinese overcapacity still a concern for Latin America steelmakers - Alacero
Bnamericas quoted Mr Jefferson de Paula, president of regional steel association Alacero said at the opening of the 58th Latin American steel congress in Cancún, Mexico as saying that Chinese surplus capacity remains a key threat to Latin America's steelmakers, despite a pickup in demand in the region. Apparent steel consumption in the region will rise 3.7% in 2017, compared to last year.
However, imports are expected to supply 23.8 million tonne or 35% of consumption, including 8.50 million tonne from China, up 11%. Imports were 19.8 million tonne in 2016, or 32% of consumption, including 7.60 million tonne from China, Alacero reported previously.
Apparent finished steel consumption in Latin America was 61.9 million tonne in 2016, down 8% on the previous year.
Mr de Paula said in a release that despite higher steel prices and a positive and less volatile outlook for 2018, Chinese surplus capacity remains a concern, standing at about 460 million tonne, nearly seven times Latin America's total steel consumption.
He added that the Chinese government has set a target of removing 150 million tonne of surplus steel capacity.
Mr Guillermo Vogel, president of Mexican steel chamber Canacero and of Alacero's Mexican committee said that "The steel market has seen a modest recovery, but serious structural imbalances persist due to the significant government subsidies received by mainly Asian companies.”
Steelmakers are investing USD 5 billion in Mexico, the region's second biggest steel producer after Brazil.
Source : BNamericas