Global steel trade up 11% to 416 mnt in 2021

• Volumes, however, fail to touch pre-Covid level
  
  
• HRCs enjoy leading 22% share in total volumes
  
  
• EU largest importing geography, while volumes to China drop
  
  
• Trade volumes may not rise against Russia-Ukraine backdrop
  
  

Morning Brief: The total global steel trade in 2021 touched 416 million tonnes (mnt), up 11% from 374 mnt seen in the previous calendar year, data collated by SteelMint reveals. However, this volume is still lower than the pre-Covid 2019 level of 435 mnt (worldsteel).

Commodity-wise trade

Semi-finished were more or less stable because China bought lot of semis in 2020. However, the next year, it stopped procuring globally because of production cuts and decarbonisation goals. Total semis trade in 2021 was at 69.65 mnt, a drop of 2% from 71 mnt in the previous year. Semis comprised 17% of the total steel trade in 2021.

Long products trade volume increased 18% to 94 mnt last calendar from 80 mnt in 2020. Within longs, wire rods have seen a considerable jump of 22% to 23 mnt (19 mnt in 2020). The share of longs in the total steel trade last year was 23%.

Flat products increased 14% y-o-y to 219 mnt against 192 mnt in 2020. These products also command the largest 53% share in the total global seaborne steel trade in 2021.

Most traded steel products in 2021

As per SteelMint data, hot rolled coils (HRCs) were the most traded finished steel item in 2021 with a share of 22% in the total 416 mnt in 2021. Y-o-y, HRC traded volumes rose 11% to 89 mnt against 81 mnt in 2020.

This was followed by galvanized, which comprised 11% of the total trade, at 47 mnt in 2021 (38 mnt in 2020). Y-o-y, galvanized trade volumes were up 26%.

The third highest traded product included billets and cold rolled coils (CRCs), with both enjoying 8% of the total traded volume. Billets remained more or less stable at 35 mnt last year while CRC volumes were up 22% y-o-y to 32 mnt (27 mnt in 2020).

In fourth place were rebar and slabs, both with 7% share in the total traded volume. While rebar traded volumes were up 16% y-o-y to 28 mnt (24 mnt in 2020), slabs dropped 9% to 30 mnt in 2021 (33 mnt).

However, these volumes are lower than the pre-Covid levels seen in 2019.

Top importing countries in 2021

Data maintained with SteelMint reveals that the European Union was the top-most importer, with many of the countries importing in huge volumes. Germany, Italy, Belgium and Poland together imported almost 69 mnt in 2021. Germany's imports comprised 23 mnt (18 mnt in 2020), up 29% y-o-y. Italy's volumes rose 21% y-o-y to almost 19 mnt (15.50 mnt). Belgium's volumes rose 37% to 14 mnt (10 mnt) while Poland imported 12 mnt (11 mnt), up 14% y-o-y.

EU import volumes rose because of rising gas prices which shut down many mills there. It emerged from lockdowns and needed steel for reconstruction, post-Covid's second wave but local prices were sky-high, forcing end-users to import.

China was the second-highest importer last calendar with 26 mnt although volumes dropped 31% against 38 mnt in 2020. The drop can be attributed to production cuts brought about by decarbonisation goals with an emphasis on usage of domestically produced steel.

The US stood in third slot with a 30% y-o-y increase in import volumes to 24 mnt (20 mnt) in 2021. Exorbitant prices of locally produced steel forced US users to import.

Turkey was the fourth largest importer globally last year with a 13% y-o-y increase to 14 mnt (12.50 mnt). The EU's sourcing of mainly flat products from Turkey post-value addition, supported the imports. As per Eurofer, Turkey was the largest exporter to the EU with 15.40% share in Q42021.

In a reverse, imports by Vietnam dropped 13% to less than 12 mnt (14 mnt) due to its long Covid lockdown last year as well as an increase in its total steel production by 19% y-o-y in 2021 to over 33 mnt.

Outlook

The current global trade volumes of 416 mnt are still lower than the pre-Covid levels. Keeping in view the Russia-Ukraine war, it is unlikely that volumes will increase in the current calendar. However, trade dynamics will change as importing countries, hedged in by supply cuts from Russia and Ukraine, explore alternate sourcing geographies.