Steel production falls 12.5%

South African steel production fell by 12.5% year-on-year (y/y) in March to an estimated 570‚000 tons after dropping by 16.6% y/y in February to 515‚000 tons‚ according to data from the World Steel Association.

For the first quarter of the year production was down 11.3% y/y and 18.8% lower than the first quarter 2012.

By contrast‚ China's steel industry‚ which is a major importer of SA iron ore‚ grew by 9.1% y/y in the first quarter to 191.9m tons‚ while the global steel industry expanded production by 2.3% y/y to 388.7m tons.

Last year SA production fell by 5.7% to only 7.12m tons‚ its lowest level since 1980‚ when the World Steel Association began collecting data. This contrasts with a 1.2% rise in global steel production in 2012 after a 8.1% jump in 2011.

In the first quarter this year SA steel production was reduced after a fire at the basic oxygen furnace in ArcelorMittal's Vanderbijlpark plant.

In mid-April ArcelorMittal SA said its basic oxygen furnaces have been recommissioned.

The company said an investigation into the cause of the fire revealed the steel-making facility had been affected by a malfunctioning sensor and controlling computer software.