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Serious production cutbacks are more than evident in the steel industry worldwide, amply reflecting the global economic slowdown. According to estimates by UK-based World Steel Association (earlier, International Iron & Steel Institute), world crude steel production fell by a sharp 23 per cent during the quarter ending March 2009. WSA's coverage spans companies in 66 countries that accounted for over 98 per cent of world steel production in 2008.
Global crude steel production was an estimated 263.653 million tonnes in 2009, down 22.8 per cent from 341.528 million tonnes in the March-ending trimester of 2008. Production cuts pervaded all steel-producing regions. EU crude steel production was down 44 per cent to 30.168 million tonnes with Germany, the largest EU producer, slashing output by 40 per cent to 7.309 million tonnes. Similar was the case with France, Italy, Belgium and UK.
USA cut production by over half with the January-March period of 2009 recording 12.097 million tonnes of crude steel output, down from 25.466 million tonnes in the same period of 2008. In 2008, despite the slowdown in the closing months, US produced 91.490 million tonnes of crude steel with a global share of 7 per cent.
Asian countries appeared to be lesser affected compared with their European and American counterparts. In Asia, total crude steel production was only 9 per cent lower–172.869 million tonnes in 2009 (January to March) against 189.859 million tonnes in 2008. During the quarter, China still had positive growth in steel output, although March 2009 did see a slender 0.3 per cent fall in production. China, the world's largest producer, produced 127.444 million tonnes, up 1.4 per cent from last year. Reeling under severe economic pressure, Japan's crude steel output shrunk 43 per cent to 17.599 million tonnes in 2009. Despite this, Japan was the second largest steel producing nation in 2009. Indian crude steel production is estimated to have fallen by 8 per cent, from 14.299 million tonnes in 2008 (January to March) to 13.170 million tonnes this year. India emerged as the third largest crude steel producer in 2009 and also had the rare distinction of producing more steel crude steel than the US. For India, these distinctions only reflect the adverse economic situation in the western world.
In 2008, world crude steel production was 1.330 billion tonnes, just a shade lower than 1.344 billion tonnes in 2007. Global crude steel output had grown furiously by over 10 per cent in 2006, after which growth rates began to lose steam. In the first half of 2007 (January to June), production growth (y-o-y) was 9.6 per cent, which fell to 6.3 per cent in the second half and further to 5.8 per cent in the first half of 2008. The blow came in the second half of 2008 when production dropped 9.2 per cent, and the first quarter (up to March) of 2009 only exacerbated the decline.
Thanks to the global economic meltdown, it would be some time before steel furnaces start melting ore the way they used to.
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