Trends and Outlook for Tube & Pipe

Transcription

1 Benedikt Blitz, Senior Market Analyst SMR Steel & Metals Market Research, Austria Benedikt BLITZ, Senior Market Analyst SMR GmbH, Austria Trends and Outlook for Tube & Pipe

2 MARKET RESEARCH SERVICES / CONFERENCES LOCATION OUR TEAM R.-P. Hammerle U. Weirather S. Posch E. Pfeifer I. Spaltmann Joy Tio M. Moll P. Moll W. Lipp A. Racu O. Spaltmann B. Blitz W. Lee T. Windberger A. Sikman W. Bulla B. Hunter Jo Zhu Conferences in association with Enduse Focused Single-Client Research Multi-Client Projects & Stainless Steel Seminars 8 th Asian Stainless Steel Conference Kaohsiung, Taiwan June th International Stainless & Special Steel Summit London, UK September th Stainless & Its Alloys Conference Chicago, USA September 13 Type of Research Products Steel Grades Single Client 85 % Multi Client 15 % Long Products 50 % Flat Products 50 % Stainless Steel 70 % Tool Steels, Eng. Steels, Nickel Alloys & Carbon Steels 30 %

3 Stainless Steel Tube & Pipe Tree % Welded STS Tube & Pipe Stainless Steel Tube & Pipe 2012 (in '000 t) Stainless Steel Tube & Pipe 4, % compared to % Seamless STS Tube & Pipe 3,560 (incl. OCTG) 656 Plate Welded Coil Welded Seamless 13Cr OCTG STS Tube & Pipe STS Tube & Pipe STS Tube & Pipe , Volume Basis Value Basis Welded 84% Seamless 11% 13Cr OCTG 5% Welded 74% Seamless 20% 13Cr OCTG 6% - 2 -

4 in 1,000 tonnes In 1,000 tonnes Historical Development of Stainless Tube & Pipe Seamless Tube & Pipe (STS & Ni Alloy) Average Annual Growth 93-12: 6 % pa Welded Tube & Pipe (STS) Average Annual Growth 93-12: 7 % pa

5 in 1,000 tonnes in 1,000 tonnes Supply vs. Demand by Region in 2012 Seamless Tube & Pipe Welded Tube & Pipe Supply Demand Supply Demand 19 % 14 % 43 % 24% 22 % 17 % 51 % 9 % Europe America Asia Others* Europe America Asia Others* Demand *incl. CIS, India, Middle East, Africa - 4 -

6 Most product segments are dominated by welded tube & pipe. Share of Seamless vs. Welded Tube & Pipe by Product Segment (Share Seamless 11 %, Share Welded 89 %) 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Seamless Welded? - 5 -

7 End Use Structure of Stainless Steel Tube & Pipe The end us structure of seamless and welded tube & pipe is totally different. Seamless Tube & Pipe Industrial Share: 95 % Welded Tube & Pipe Industrial Share: 38 % Oil & Gas Transport/ Automotive Chemical/ Petrochemical Chemical/ Petrochemical Power Generation ABC 40% Food Processing Transport/ Automotive Oil & Gas Other Food Processing Other Power Generation - 6 -

8 Grade Structure of Stainless Tube & Pipe Due to the different end use structure, also the grade mix is different. STS Seamless Tube & Pipe STS Welded Tube & Pipe O O Duplex O. Ferr O. Ferr. Duplex - 7 -

9 Industry Consolidation: Market Shares of Top Producers in 2012 The seamless tube & pipe market is much more consolidated than the welded market. Aggregated Market Share 90% 80% 70% 60% 100 ktpy 50 ktpy 10 ktpy Seamless 50% Welded 40% 30% 20% 10% 0% Top 5 Top 10 Top

10 tonnes tonnes Top 10 Producers of Stainless Steel Tube & Pipe in 2012 Seamless Tube & Pipe (Total 456 kt) Welded Tube & Pipe (Total 3,560 kt) *Nippon Steel & Sumitomo Metals **Salzgitter Mannesmann Stainless Tubes *** POSCO Specialty Steel Co

11 Index Based on 2007 Forecast: Development of Seamless vs. Welded Tube & Pipe Seamless Welded Growth of Industrial Applications Growth of Construction & Automotive

12 Index Based on 2007 Forecast: Development by Region for Stainless Tube & Pipe (Seamless & Welded) 180 Europe America Asia 160 Others World

13 What is ahead for Welded? Automotive / Transport: Impact of E-mobility? E-cars will reduce use of exhaust tubes substantially from on? Particularly expected earlier in Asia and America later in Europe. More demand in automotive (e.g. fuel lines for E10, stricter emission regulations worldwide). Still huge growth expected in China and India but slowing in China after Automotive production weak in Europe 2013, total Europe, but improving from H2/2013. Growth expected in Europe from 2014 on. Urbanization will support use of ornamental tubes (e.g. handrails for trains buses, etc.). Limited growth for structural tubes in Buses due to cost reasons. Building & Construction: Europe, new housing starts at ~65 % of pre-crises 2008 levels but bottom will be reached in 13. Substantial growth in Europe expected from 2015 on, America already improved in Public Building activity will remain low (bridges, tunnels, etc.) but maintenance demand to come. Risk China s housing bubble will burst (fast increasing prices, more difficult to get credits) but still rural areas to be developed outside coastal areas. 200 series will continue to lose importance in China and India. More demand for drinking water tubes

14 What is ahead for Welded? Industrial Use Chemical activity still relatively strong due to a high number of projects but slowing expected 14. New projects in China recently announced (BASF) but slowing from 2020 due to massive capacity increase (2000 to 2020). Europe mostly replacement of existing production lines and maintenance demand. Cladding will reduce need for STS tubes (carbon steel tube + stainless layer). Food Processing was quite resistant against economic downturns, expected to stay strong. Urbanization and stricter quality controls will support use of stainless steel. Globalization is another key factor: global players (Unilever, Nestle, etc.) use same standards. Mega-LNG projects in Australia (Gorgon, Ichthys and Wheatstone) require large volumes welded pipe delivered between 2010 and Once shipments for these projects are completed, a few years of lower activity can be expected before the next wave of projects starts. Significant growth is expected for clad pipes used for infield flowlines and risers. General Aspects AST: Marcegaglia and Arvedi potential co-buyers with Aperam (but uncertain). Development of Italian welded tube production? Risk new owner of AST will increase prices? Increasing competition from Asia as low cost supplier? Why there is no consolidation of Italian welded tube producers? Brazil: Import duties against welded tube & pipe from China & Taiwan, in Europe duties unlikely

15 What is ahead for Seamless? Power Generation In the long-term, the boom for new power plants will continue as coal fired plants throughout the world are upgraded to improve efficiency and the reduce emissions. India will be the main driver for new coal fired power plants but also in China coal power is still growing; new projects also in Poland. Declining share of coal fired power generation in Europe and the USA. For upgrades and extensions of existing coal fired plants, stainless tubes may be selected but for pure maintenance of older plants, the original tube material is used (mostly carbon and alloy steel tubes). 700 C units development going on, commercial production after Gas fired power plants stronger as coal fired but also limited (lack of operator interest) only little stainless tube use for gas fired power plants. Nuclear forecast EIA indicates again growing share of nuclear in energy mix until 2030 some regions are against nuclear (Europe, Japan) but China, Korea, US, India will install more units. Renewable show fastest growth but use little seamless! Imposition of Chinese duties against Japan and Europe prompted a trade dispute between China and Japan: Japan is requesting a WTO dispute panel. Chemical & Petrochemical: Same as for welded tube

16 What is ahead for Seamless? Oil & Gas: New capacities for seamless OCTG were coming on stream (e.g. Tubacex, Jiuli, PCC) resulting in lower capacity utilization. OCTG demand will grow strongly during next 5 years so utilization rates will improve again. Demand for super-duplex tubes for umbilicals will rise significantly in coming years (especially for projects in South-East Asia). Even though new capacities were installed e.g. by SBER in Austria, capacity utilization is expected to exceed 95 % by The number of floating platforms built per year will grow from 16 in 2012 to an average of 25 between 2014 and 2017 resulting in good demand for heat exchanger tube and process pipe. General Aspects Newcomer in the USA: Schulz started full production. Consolidation of NSC and SMI to Nippon Steel & Sumitomo Metals as new entity. Europe: Import duties against Chinese seamless tube & pipe who will benefit? Chinese imports have not disappeared completely despite high duties (48 72 %). Exports from India to Europe have increased significantly actions against Indian producers possible (use of Chinese raw materials mother tubes). Brazil: No domestic seamless tube producer in Brazil despite local content request

17 The World Market for Stainless Steel Tube & Pipe Market Volumes - Market Segments - Technology - Producers - Prices - Outlook The most comprehensive report available in the industry! 300 pages - 50 countries company profiles producers listed Consumption and Production of 50 Countries Worldwide Detailed Analysis of End Use Segments Welding Technology and Production Costs Company Profiles of the top 100 producers worldwide

18 There are always new applications! It is always wise to look ahead, but difficult to look further than you can see. Winston Churchill Source: Thank you very much for your attention! Benedikt BLITZ, Senior Market Analyst SMR GmbH, Austria