The steel committee of the Organization for Economic Co-operation and Development (OECD) has stated in a new report on recent developments in steelmaking capacity that the latest available data suggest that global steelmaking capacity decreased for the second consecutive year in 2017, declining by 1.3 percent year on year, adding, however, that this modest adjustment still falls short of alleviating global excess capacity. Moreover, a number of new investment projects continue to take place around the world and global steelmaking capacity could increase by 2.3 percent between 2018 and 2020 in the absence of any further capacity closures. Accordingly, global excess capacity is expected to continue to be a major challenge for the global steel industry, the OECD added.
According to the OECD, the updated information on announced investment projects in the global steel industry suggests that nearly 52 million mt of gross steelmaking capacity additions are currently underway and could come on stream during the three-year period of 2018-20. Furthermore, an additional 39 million mt of steelmaking capacity additions are currently in the planning stages for possible start-up during the same time period.
The OECD also stated that the Middle East region is expected to experience a considerable increase in steelmaking capacity over the next few years, while many capacity additions are also planned in Asia. The information on announced investment projects also suggests that the CIS region, Latin America and Africa are regions where steelmaking capacity could increase somewhat in the coming years.