Steel prices squashed as auto demand and output go into reverse

Jun 12 08:06 2019 Print This Article

Almost everywhere you look, auto production and sales are falling and putting pressure on one of the major end-user segments of steel.

News within the space of a fortnight that British Steel was insolvent and Ford’s Bridgend plant in the UK would cease production in 2020 was somewhat emblematic of the challenges faced by carmakers and their steel suppliers.

According to the World Steel Association, a typical car comprises around 900 kg of steel, 34% of which is used in the body structure and 23% in the engine block and gear mechanism.

On most estimates, more than 10% of UK steel is consumed by local car manufacturers. In the US and Germany, the proportion is far higher at around 25%. Almost 14% of ordinary carbon steel and 25% of special steel that Japan produces is destined for the country’s carmakers.

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The Barrel

S&P Global Platts provides market insights so people can make more informed trading and business decisions.. They're the leading independent provider of information and benchmark prices for the commodities and energy markets. Customers in over 150 countries look to their expertise in news, pricing and analytics to deliver greater transparency and efficiency to markets. S&P Global Platts coverage includes oil and gas, power, petrochemicals, metals, agriculture and shipping. S&P Global Platts provides critical information for the commodities & energy markets to make physical commodity markets more transparent and efficient. S&P Global Platts blog, The Barrel, provides the essential perspective on global commodities.

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