Becky E. Hites, President, Steel-Insights, LLC, USA will discuss whether or not European Steelmaking can rebound and what she sees coming next from low cost producers. Joining Becky on the programme are many of the top organisations in the industry including ThyssenKrupp, CRU, Wood Mackenzie, Gujarat NRE Coke Limited, Polski Koks and many others! Register today!
Hites shared some insights with us as we lead into the 2014 edition of Eurocoke:
How do we know what we know? In a cyclical industry, how can we tell if there's been a fundamental shift that has changed the continuum? Is today's steel world a Dr. Jekyll or Mr. Hyde environment (the book's author was from Edinburgh)? Let's take a step back and determine what we know.
At about 1.6 billion tonnes, global crude steel production has been essentially flat for the past three years after a period of high growth. The global steel industry has experienced a 20 year period of high growth from 1950 to 1970 followed by about 25 years of lackluster performance. Crude steel production has grown consistently in China and the Middle East for the past 10 years. Those two markets now account for over half of the world's steel production. The top ten steel producing countries account for over 80% of global steel production and half are developing world countries. Through 2012 (the data for 2013 isn't yet available), the top twenty steel producers accounted for about 40% of global shipments despite a 97% increase in global capacity since 1999. The tonnage threshold to make the top 20 list has doubled on an absolute tonnage basis, but remained consistent at 1% of global steel production. China, which represents 49% of global crude production accounts for 42% of the top twenty steel-making companies and has 9 companies on the list.
The world changes and we all know that the steel industry has changed. It's a cyclical industry that is a late-in-stage economic beneficiary and the global economy is still hasn't completely recovered from the 2008 Western World financial meltdown. The only way for companies to "win" is to discern the correct adjustments effectively execute them. Critical resources of the past can become irrelevant to the future. The coastal castles that are all over Scotland attracting tourists today were once pivotal to the survival of the country.
In WWII, American submarine commanders endured despite being outclassed by superior equipment and outgunned (fully functioning torpedoes weren't available to them for the first 21 months of the Pacific War). In the fog of war, as often is the case in business, decisions with long impacting outcomes have to be made without the luxury of complete or definitive information. Steel-Insights was formed to assist executive management teams navigate the "noise of battle" by more effectively managing the abundant resources available today and harnessing those resources to explore thought provoking and penetrating issues in order to magnify the pivotal decisions required for the long-term success of their companies in arguably tough industries that must survive challenging cycles, i.e. training and empowering submarine commanders.
Steel-Insights, LLC - Seeing what others don't.