Chinese stainless steel growth likely to sustain, says Macquarie

BEIJING (Scrap Monster): According to the latest research report published by Macquarie, the stainless steel output growth will continue to maintain its momentum during 2014. The commissioning of large number of stainless steel facilities in the country will largely contribute to the sustained growth. However, the slowing investment will take the growth to single-digit over the next five years.

According to Macquarie, the Chinese stainless steel output grew at the rate of 20% in 2013, while many other regions in rest of the world recorded flat growth rate during the year. China accounted for more than 50% of the world stainless steel production during 2013. The net exports by the country grew almost 50% in 2013 when compared with the previous two years. The country will continue to drive the global stainless steel output growth in 2014.

The easy availability of cheap ferronickel gave the Chinese stainless steel manufacturers an edge over global peers. But the recent nickel ore export ban imposed by Indonesia may have adverse effect on the country’s stainless steel makers.

Macquarie pointed out that China's stainless steel output growth will slide to one digit during the coming five years on the slowing investment growth in China. However, attributed to newly constructed capacity, China's stainless steel output growth is expected to be 10% to 11% in 2014 and 2015. Stainless steel export is forecasted to maintain the current momentum.