Emerging markets to drive global steel output recovery in 2010 - Evraz
Moscow. February 4. Interfax - Demand from emerging markets, not Europe or the United States, will enable global steel production to recover to pre-crisis levels in 2010, the chairman of Russia's Evraz Group, Alexander Abramov, said at the Russia 2010 forum in Moscow.
"We don't see demand in the United States or Europe returning to its 2007 level - that'll take more time, two or three years. But demand in emerging markets like China will recover to 2007 levels," Abramov said.
Rapid growth in steel consumption and equally rapid growth in finished steel production is expected in China, Abramov said. The tendencies in China include domestic consolidation, and attempts by Chinese steel companies to secure access to iron ore in Brazil and South Africa, he said.
The Chinese government is trying to shut down inefficient capacity in the country, but this will take time, he said.
Abramov also singled out Brazil, which he said could increase steel exports to Europe and the United States.
Abramov said he did not think there was much potential for consolidation in the global steel industry. He said steel companies would be focusing on establishing a firm foothold in regional markets in the next two or three years.
Companies need to have the potential to grow in value if they are to merge, and an EBITDA margin of more than 15 percent if they are to attract buyers, Abramov said.