Commodities: World Steel Output +4.6% in June (6 Aug 2019)

Exports of steel from Turkey surged 30% year-on-year in May to 2.1 Mt, based on new data from the Turkish Steel Producers’ Association. Domestic out­put fell by 8% nonetheless to 3.1 Mt in the month due primarily to weaker domestic demand even as international demand for Turkish steel continued to grow. In the year through May, steel shipments from Turkey jumped by 20% in the five-month period to 9.8 Mt. The US deciding to reduce tariffs on Turkish steel exports also spurred demand for steel exports to the US, one of Turkey’s major Atlantic buyers.

A combination of lower output forecasts in the EU, Russia and Canada has prompted the International Grains Council to reduce its newest projection for world wheat production in the 2019-2020 season. IGC now expects to see 763Mt in wheat produced in the current season, 6 Mt less than its previous pre­diction. While it kept its forecast for US output flat at 333.5 Mt, IGC lowered predictions for Russian output to 75.7 Mt (down from 79.5 Mt), EU output to 148.7 Mt (down from 151.2 Mt) and Canadian output to 32 Mt (from a previous 33.6 Mt). The EU itself recently downgraded its in-house forecast for wheat production to 141.3 Mt, slightly lower than the 142.3 Mt prediction it had the month before.

Global steel output (for the 64 countries tracked by the World Steel Association) amounted to 159 Mt in June, a considerable 4.6% gain over the same month a year before. The first half of the year saw total world steel production hit 925.1 Mt or 4.9% higher than the first half of 2018. Asian steel output was 660.2 Mt in the six months (+7.4% YoY) while EU output was 84.7 Mt in the same period (-2.5% YoY). North American output rose just 1.4% in the half to 60.1 Mt while CIS output remained flat YoY at 50.5 Mt. EU-based output in June included a 5.8% YoY decline in German production at 3.4 Mt, a 3.4% YoY increase in French output at 1.3 Mt and a 2.3% YoY gain in Spanish output to 1.2 Mt. Turkish output fell 11.0% YoY to 2.7 Mt in June while Ukrainian production fell 3.0% YoY to 1.7 Mt in the same month.

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