Steel consumption in ASEAN-6 contracted in 2017 largely due to the slowdown in construction sector as well as the destocking activities in countries like Thailand, Vietnam and Malaysia. According to data from the newly released 2018 SEAISI Steel Statistical Yearbook, total apparent steel consumption in the six ASEAN member countries of SEAISI i.e. Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam dipped 4.1% year-on-year to 73.8 million tonnes in 2017.
Vietnam remained the biggest steel consuming country in ASEAN. However, steel demand in the country dropped 3.1% year-on-year in 2017 to 21.6 million tonnes. This came after three consecutive years of annual consumption growth rates of more than 20%. Going forward, while Vietnam’s steel demand is expected to return to growth path, the rates of growth are unlikely to be as robust as before.
Thailand, after rebounding strongly with a year-on-year steel consumption growth rate of 15.1% in 2016, saw its steel demand plunging 14.1% year-on-year, from 19.2 million tonnes in 2016 to 16.5 million tonnes in 2017. Other than the slowdown in construction activities, Thailand’s steel sector was also badly hit by the destocking activities following a massive stockpiling in 2016.
Indonesia, on the other hand, continued its turnaround in steel demand growth in 2017, registering a credible annual consumption growth rate of 7.3%, following the 11.4% year-on-year growth rate in 2016. Total apparent steel consumption increased from 12.7 million tonnes in 2016 to 13.6 million tonnes in 2017.
Malaysia’s annual steel consumption had consistently stayed in the region of 10 million tonnes since 2013. However, after a 7.9% year-on-year drop in steel demand in 2017, total steel consumption in Malaysia dipped below 10 million tonnes to 9.4 million tonnes. Malaysia has, for the first time, fallen behind Philippines in annual steel consumption volume.
Philippines’ steel demand started to pick up rapidly in 2010 and the country has been experiencing strong year-on-year consumption growth rates since then. In 2016, the country’s steel demand jumped 10.5% year-on-year to reach 9.7 million tonnes. In 2017, Philippines’ steel consumption growth slowed down to only 1.5% and total steel demand in that year inched up to slightly above 9.8 million tonnes.
Singapore, the only developed country in the region, continued to exhibit steel consumption pattern of a mature market. The country’s steel demand dropped marginally, by 1.6% year-on-year, to 2.8 million tonnes in 2017.
While total apparent steel consumption dropped, crude steel production in ASEAN-6, however, picked up strongly in 2017, by 27% year-on-year to 26.3 million tonnes. Production of hot-rolled steel products also increased from 31.9 million tonnes in 2016 to 34.7 million tonnes in 2017, a jump of 9% year-on-year.
ASEAN-6’s import of iron and steel products, including semis, retreated 13.8% year-on-year to 59.8 million tonnes in 2017. China continued to be the largest source of supply but its share of total imports has dropped from 53% in 2016 to 43% in 2017. Japan was the next biggest supplier, accounting for 23% of total imports, followed by South Korea (11%), and Taiwan (7%). India, which, in the past, was not a notable steel exporter to ASEAN-6, saw its share of total imports in the region increasing from 2% in 2016 to 5% in 2017. Its main export product was hot-rolled coil.
Following the big increase in crude steel production in ASEAN-6 in 2017, import of semi-finished products into the region saw a sharp decline in volume, from 15.7 million tonnes in 2016 to 10.8 million tonnes in 2017, a drop of 32% year-on-year.
For finished steel products, the biggest import items in 2017 remained plates, hot-rolled sheets and strips which totalled 22.1 million tonnes, a moderate drop of 7% from the previous year.
Import of sections, bars and wire rods, the next biggest import items, went down significantly, by 22% year-on-year to 10.4 million tonnes in 2017.
Other major import items in 2017 were coated sheets and strips (7.6 million tonnes), and cold rolled products (6.4 million tonnes).
All the six ASEAN countries saw their import volumes decreased in 2017. Vietnam remained the biggest steel importer in the region with total import volume of 15.8 million tonnes in 2017, down 17.6% year-on-year. Thailand also saw a significant decline in steel import volume. Thailand’s import of iron and steel products totalled 14.8 million tonnes in 2017, a sharp drop of 18.4% over the preceding year. Indonesia was the third largest steel importer in the region, with total import volume of 11.9 million tonnes in 2017, a moderate decline of 5.8% year-on-year.
The six ASEAN countries together exported a total of 15.3 million tonnes of iron and steel products in 2017, a significant surge of 22% over 2017. Vietnam, with an export volume of 5.3 million tonnes, was the largest steel exporting country, followed by Indonesia (3.6 million tonnes), Malaysia (3.1 million tonnes), Thailand (1.9 million tonnes) and Singapore (1.4 million tonnes). Philippines’ export volume in 2017 was only 100,000 tonnes, all pipes and tubes.
Get hold of a copy of the 2018 SEAISI Steel Statistical Yearbook for comprehensive information on the production, consumption and trade statistics of the steel industry in ASEAN-6 as well as Australia, Japan, South Korea and Taiwan.
TAN AH YONG