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Summary
Since 2020, the steel industry has exhibited both resilience and volatility, with China continuing to dominate global production and consumption. While global steel production demonstrated notable stability during the COVID-19 pandemic, a 4% decline occurred in 2022, with the EU seeing a significant 10.4% decrease in output, partially due to soaring energy costs.
The French steel industry rebounded with an annual growth of 37% between 2021 and 2022. However, in 2023, a downturn is expected. In terms of market segments, carbon steel remains the predominant type, and electric furnace production, being more eco-friendly, is seen as increasingly necessary due to its lesser carbon footprint. French trade experienced a shift from a steel product surplus of over 1 billion euros in 2015 to a deficit of 1.6 billion euros in 2022, reflecting intense global competition and the impact of U.S. tariffs. The French industry is intricately tied to construction, the major consumer of steel, with a looming crisis indicated by plummeting reservations for new apartments.
Compounding the situation are escalating energy prices, which rose by 107% between 2021 and 2022, squeezing the industry. French exports, primarily to neighboring European countries, increased by 55% and 19% in 2021 and 2022 respectively, while imports grew more significantly at a 9.63% annual average from 2015 to 2022. The industry is closely monitoring raw material costs, energy prices, trade regulations, and sector-specific demands, which all directly influence production and sales trends.
Resilience and Challenges: Fluctuations in the French Steel Industry
As we delve into the main trends governing the French steel market, we observe a compelling landscape marked by recovery, demand variations, and regulatory impacts. Starting with the construction sector, which is the chief consumer of steel products in France, we see that despite a notable increase in sales by 6.8% in the sector in 2022, there has been an alarming drop in reservations and sales for new apartments and homes at the beginning of 2023. This unsettling trend points to forthcoming difficulties for both the construction and steel industries, as their interdependence means that a decrease in construction activity directly leads to reduced orders for steel products. Specifically, the construction sector accounts for between 40 and 45% of steel consumption in France, particularly involving products used in concrete reinforcement and steel structures.
The French steel market has also seen considerable ups and downs in recent years. Sales trends indicate an average annual growth rate of 2.66% between 2012 and 2022, with a sharp decline of over 24% between 2019 and 2020 due to the COVID-19 crisis. Following this, the market exhibited a strong recovery with an average annual growth rate of 37% between 2021 and 2022. However, early indicators for 2023 suggest a possible downturn in activity, potentially by around 10 to 15%. Regarding the types of offers, steel is predominantly produced through either the blast furnace or electric arc furnace processes, with the latter being more environmentally friendly and accounting for about 30% of steel production in France. The steel industry represents a significant portion of greenhouse gas emissions, equivalent to three to four times the emissions of the aviation industry, emphasizing the need for more sustainable practices.
The world steel market has also faced a slowdown. After several years of average annual growth around 1.88%, global production began to decline in 2022, mainly due to the increase in energy costs — a major concern for an industry heavily reliant on energy consumption. In terms of the French steel industry's occupations, there is a diversity of professions such as basic steelmaking, cold drawing, profiling, and rolling. These different processes cater to a wide range of needs across industries, from construction to manufacturing and more.
Prominent Contenders in the Global and French Steel Arena
The steel industry landscape is dotted with immensely influential global giants and significant national entities that drive the production and innovation within the sector. Among the most eminent players, several corporations stand out due to their size, reach, and impact on the market.
- ArcelorMittal leads the charge as not just a name synonymous with steel production but also as a behemoth responsible for setting industry benchmarks. With formidable production capabilities and a global footprint, ArcelorMittal serves as a pillar in the international steel production community, influencing market trends while delivering a wide array of steel products to various industries.
- China Baowu Group, another heavyweight, brings intense competition to the global stage. As a state-owned enterprise, it reflects China’s prominent role in steel manufacturing. Its production might is indicative of the country's vast raw material resources, manufacturing prowess, and the strategic integration of industry that powers its massive urbanization and infrastructure needs.
- Nippon Steel Corporation, hailing from Japan, has been a trailblazer in steel technology and environmental stewardship. Japanese precision and innovation lead Nippon Steel Corporation to offer high-quality steel across the globe, catering to a range of industries with a particular emphasis on technological advancement and sustainable practices.
- Riva Acier France is a key player in the French market, and a significant contributor to the local economy. Riva Acier's operations reflect the nation's expertise in manufacturing various steel products, and it plays a crucial role in meeting the domestic demands of the French construction and manufacturing sectors.
- Aubert & Duval specializes in high-performance steel, superalloys, and other metals critical for challenging and cutting-edge applications. It underscores France's capability to innovate and serve industries that demand materials capable of withstanding extreme conditions.
- Aperam Groupe, specifically Aperam Stainless France, shines in the specialized segment of stainless steel production. The company is a testament to advanced manufacturing and the value of stainless steel across multiple sectors including healthcare, housing, and infrastructure.
- Eramet, with its diversified portfolio, not only focuses on steel production but also engages extensively in mining, illustrating the interconnected nature of raw material extraction and the supply chain in steel manufacturing.
- Valourec is notable for its specialization in the production of steel tubes and pipes, which are essential components in global industries such as oil and gas, as well as in the energy transition toward renewables. Together, these key
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Inforamtion
- Number of pages : 30 pages
- Format : Digital and PDF versions
- Last update : 15/09/2023
Summary and extracts
1 Market overview
1.1 Definition and scope of the study
The steel industry represents all the techniques and industries involved in the manufacture of iron and iron alloys. It is an essential sub-field of metallurgy, which studies the manufacture of metals in general.
The world's biggest steel producers are China, which will dominate global production with more than half of global output in 2020 (928.3 Mt ), followed by Indiaindia (106.5 Mt) andjapan (104.3 Mt). China's dominance can be explained by the fact that the country is rapidly urbanizing, and that demand for steel is high in the construction sector, for example, but also by the fact that the Chinese government is actively implementing strategies aimed at consolidating its position as the world's leading producer.
For its part, the European Union produces around 160 million tonnesof finished steel per year.
The steel industry and the iron ore and coal mining industries, which supply its main raw materials, have historically been highly cyclical highly cyclical. They are strongly affected by general economic conditions, consumer trends as well as global production capacity and fluctuations in international trade steel trade and customs duties. This is due to the cyclical nature of the automotive, construction, machinery & equipment and transport industries, which are the main consumers of steel.
As defined by INSEE, the steel industry in France comprises :
- production of pig iron and spiegeleisen in pigs, brines or other forms
- production of ferroalloys
- production of ferrous products obtained by direct reduction of iron ores and other spongy ferrous products
- production of exceptionally pure iron by electrolysis and other chemical processes
- the production of iron or steel ingot scrap
- the production of iron pellets and powders
- production of steel ingots and other primary forms
- production of steel semi-finished products
- the manufacture of flat-rolled steel products obtained by hot and cold rolling
- manufacture of hot-rolled steel bars
- manufacture of hot-rolled steel open sections
- production of steel sheet piling and welded open sections
- manufacture of unassembled rail track components in steel
At2022,one ofmajor challengeschallenges for the steel industryrising steel prices in Europemost of these are the result of the Russian-Ukrainian conflict underway since February 2022.
1.2 World market: Global steel production to slow down in 2022, despite considerable resilience to Covid 19
World steel production Source: ****
Since the subprime crisis, global steel production has continued to rise, with an average annual growth rate of *,**%. The steel industry has shown remarkable resilience during the global health crisis of COVID-**, maintaining relatively stable production between **** and ****, even when the global economy, particularly the construction sector, ...
1.3 French market
French steel market sales trend (***) France, ****-****, Million euros Source: Insee /Insee sales in the French steel market grew at an average annual rate of *,**% between **** and ****. GDP, meanwhile, grew by an average of *% a year over the same period, reaching **.* billion euros in ****. The French market has not been as ...
1.4: Balance of trade
Imports/exports of steel products in France France,****-****, million euros Source: French Customs French exports of steel products (***) grew by an average of *.**% over the period **** to ****with a significant drop of around **% in ****. This decline was largely offset in **** and ****, with respective increases of **% and **% in exports. However, despite ...
2 Demand analysis
2.1 Construction: Europe's No. 1 consumer of steel products
Steel consumption in France France, ****, %, steel consumption
At European level, the construction industry is the leading consumer of steel products. Despite French production mainly based on the production of flat productsused in industry (***), beams and steel for metal envelopes
Index of evolution of income in construction ****-****, value of index **** = *** Source: ...
2.2 The transport industry: France's second-largest consumer of steel products
With**%of French steel production,the transport sector is France's second largest steel consumer. This is largely due to the automotive sector, but also to the railways
Steel used in the automotive sector (***) is a high value-added product.high value-added productsused for bodywork and engine components.
Sales growth index for the ...
3 Market structure
3.1 Value chain
Today, steel production can be divided into two main processes: the melting process and the casting processhe cast-iron processand theelectric die. In France, the electric sector accounts for around **% of steel production, a figure lower than before the ****-**** crisis. In the United States, on the other hand, the electric sector ...
3.2 The different professions in the French steel industry
Basic steelmaking :
Basic steelmaking encompasses the process of steel production in a steel mill, where raw ore or scrap is transformed into various forms of semi-finished products such as slabs, billets, blooms, and many others.
Cold drawing
Wire drawing refers to the operation whereby a metal wire is passed through a ...
3.3 Determinants of steel industry activity
In this section, we will examine the various factors that explain the past and future development of the steel industry:
*) Consumers of steel products
As we have already seen in section * on the sectors that consume steel products, the good financial and economic health of these various sectors has a ...
3.4 Workforce and steel plants in France
Number of establishments in the steel industry in France France, ****-****, Number of establishments Source: ****
Number of employees in steel establishments in France France, ****-****, Number of employees Source: ****
The number of steel plants in France has remained relatively stable for around a decade, with a total of around ** . Significant barriers ...
4 Offer analysis
4.1 Types of offer
Steel is the second most the produced in the world after cement. This metal is widely used because it is cheap, strong and highly versatile. Steel is relatively environmentally friendly compared to other materials, as it is fully recyclable and consumes little energy. Most steels contain iron and varying amounts of ...
4.2 Basic steelmaking
Basic steel production trend index France, ****-****, Base *** in **** Source: ****
In ****, basic steel production in France recorded a significant drop of *.*%to below pre-crisis levels. This decline is mainly due to the combined effects of the deteriorating economic context and the energy crisis affecting Europe, which had a particular impact on ...
4.3 Primary steel production
Sales for the French manufacture of steel tubes, pipes, hollow sections and related accessories France,****-****, Index base *** in **** Source: ****
since the subprime crisis, there has been a general since the subprime crisis, there has been a general downward trend in sales in steel tube and pipe production. However, it is ...
4.4 A price strongly correlated with raw material prices.
French industrial producer price index: (***) France, ****-****, base *** (***) Source: ****
International price indices for imported raw materials: Iron France, ****-****, base *** (***) Source: ****
Producer prices for steel products rose sharply in **** and ****, in correlation with the significant increase in raw material prices, particularly for iron ore. However, this upward trend in producer prices ...
5 Regulations
5.1 Regulations
As steelmakers generate almost **% of their business from exports, they are highly sensitive to changes in international regulations, particularly with regard to customs duties.
In France, the steel industry is governed by the Convention Collective Nationale de la Sidérurgie of November **, ****
The EU is the world's second largest steel producer ...
6 Positioning the players
6.1 Player segmentation
- ArcelorMittal
- Aperam Groupe - Aperam Stainless France
- Eramet
- China Baowu Group
- Nippon Steel Trading Europe
- Riva Acier France
- Vallourec
- Aubert et Duval
- ThyssenKrupp
- Ascometal
- Industeel (Arcelor Mittal)
- H2 Green Steel
- Nippon Steel Corporation
- Erasteel
List of charts
- Steel consumption in France by sector of activity
- Index of income growth in construction 2005-2022, value of index 2015 = 100
- Global steel production
- Worldwide breakdown of crude steel production
- Largest steel-producing countries
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Latest news
Lithium: Eramet and Electricité de Strasbourg set out to conquer Alsace's white gold - 06/12/2023
- The "Ageli" project, which stands for Alsace géothermie lithium, aims to produce the equivalent of 10,000 tonnes of lithium carbonate by the end of the decade.000 tonnes of lithium carbonate, enough to cover the needs of 10% to 15% of France's future gigafactories and to equip 250,000 electric cars with batteries.
- In Latin America, the French mining group uses a lithium sponge to capture the white metal contained in pumped brine. Once the white gold has been extracted, the water is reinjected. The Argentine project is expected to produce 24,000 tonnes of lithium per year.
- In Alsace, the idea is to capture lithium by passing brine from the Rhine basin through the lithium sponge.
- ES operates another geothermal power plant in Soultz-sous-Forêts, where Eramet has also conducted tests
- Lithium becomes the key product for profitable geothermal projects
Storing hydrogen in tubes: Vallourec's idea to get the market off the ground - 06/12/2023
Eramet and Suez choose Dunkirk for future battery recycling plant - 23/09/2023
- The new industrial site for recycling electric car batteries will come on stream in 2027.
- The recycling plant will be capable of processing 50,000 battery modules a year, equivalent to 200,000 electric car batteries.
- By 2027, 90% of cobalt, copper and nickel, and 50% of lithium should be recycled, according to the requirements of future European regulations.
- Less than 1% of lithium and rare earths are currently recovered.
- from 2030 onwards, recycling is set to increase, due to the arrival of end-of-life car batteries.
- Eramet has received a €70 million grant from the European Union and €10 million from Bpifrance.
At Le Creusot, Industeel launches work on its vertical caster - 15/09/2023
- Investment: 52 million euros
- Plant employs 728 people (1,000 including temporary workers)
- Sales of 315 million euros by 2022, 70% of which in Europe
- Le Creusot steel mill sells 80,000 to 100,000 tonnes of steel per year
Eramet refocuses on its mining activities - 04/07/2023
- Eramet is France's largest mining group.
- Eramet has just finalized the sale of its subsidiary Erasteel to the Belgian investment fund Syntagma Capital.
- Erasteel was created in 1992 and employs 850 people.
- Erasteel generated sales of 275 million euros.
- The sale by Eramet of its subsidiary Aubert & Duval was completed in April 2023.
- Aubert & Duval employs 3,600 people.
- Eramet has a strong presence in manganese, which accounts for 63% of their 2022 sales of 5 billion euros, nickel (28% of their sales), and mineralized sands (9% of their sales).
Vallourec opens up new markets with 3D printing. - 01/07/2023
- Two 3D printing robots are installed at Vallourec's Aulnoye-Aymeries site, along with five others
- Vallourec has chosen wire arc deposition (WAAM) technology for its 3D printing process.
- WAAM can be used to manufacture parts weighing up to a ton.
- A robot costs between 200,000 and 250,000 euros.
- The new robots will be able to print 10 to 20 tons of parts each year, compared with the 400,000 tons produced by a rolling mill.
- WAAM technology is suitable for small production runs of between 10 and 20 parts.
- Naval Group is Vallourec's first customer for its French site.
- Vallourec already has a robot in Germany and others in Singapore using WAAM.
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