@ SMR GmbH Steel & Metals Market Research Reutte, October 2013

Transcription

1 @ SMR GmbH Steel & Metals Market Research Reutte, October 2013 This study was exclusively prepared for IMOA. It may not be copied, published or disclosed to third parties without the permission of SMR GmbH.

2 IMOA recently completed the latest update of its regular end use analysis. The Mo market perspectives for the next decade remain promising: the demand for Mo will reach more than 430,000 t by 2022; the market will grow by more than 3% in the period The fastest growing region will be Rest of the World (India, Africa, Middle East) with 4.8% p.a., followed by China with 4.2% p.a. Europe and America will both grow below 3% in the next decade. After two years with limited growth in 2012 and 2013, the global Mo demand will gain momentum from 2014 on. First Use Structure Almost 322,000 t of Mo (including Mo in scrap) was consumed in 2012 compared to around 318,000 t in the previous year, which corresponds to a 1% market growth. The first use structure only slightly changed within this time frame, with the largest first use sectors being Engineering Steels (36%), Stainless Steels (26%) and Tool and High Speed Steels (combined 11%). Mo Metal 4% Foundries 8% Nickel Alloys 5% Chemicals 10% Engineering Steels 36% Tool Steels 11% Stainless Steels 26% Total First Use 321,600 t SMR Steel & Metals Market Research 2013 Page 1

3 Mo Units [ tonnes ] In 2012 the market developed somewhat better than expected in the last issue of this report, particularly due to strong deliveries in the for the oil and gas segment (including pipeline deliveries for Chinese gas pipelines) which prevented a negative growth. Mo in Scrap 140, , ,000 80,000 Scrap Ratio: 14% 15,970 Scrap Ratio: 40% Total Scrap Ratio: 26% Mo in Scrap Primary Mo Total Mo in Scrap: ~84,500 kt 60,000 40,000 20, ,330 Engineering Steels 33,540 51,030 Scrap Ratio: 50% Scrap Ratio: 11% 17,840 18,140 3,370 29,040 Scrap Ratio: 19% 4,550 19,710 Scrap Ratio: 60% 8,990 6,070 Scrap Ratio: 2% ,700 Stainless Steel Tool Steel Chemicals Foundries Nickel Alloys Mo-Metal Almost 85,000 t of the total Mo consumption came from Mo units in scrap. Approximately 26% of all Mo units in Mo containing production worldwide originated from scrap in 2012 compared to 25 % in However, the scrap ratio in Mo containing materials varies significantly: the content is around 60% in nickel based alloys including superalloys and 50% in tool and high speed steels, while in engineering steels (mainly from revert scrap) and Mo-Metal it is lower. In case of Mo-Metal, the use of scrap for own production has just started in Before that, Mo-Metal scrap was completely used in production of steel types particularly at nickel alloy producers. Nevertheless, volume-wise, most of the Mo in scrap came from stainless steel, tool steels and engineering steels. SMR Steel & Metals Market Research 2013 Page 2

4 Primary Molybdenum (excl. Mo in Scrap) Super Alloys 3% Tool Steels 8% Mo-Metal 5% Foundries 8% Engineering Steels 43% Chemicals 12% Stainless Steels 22% Total First Use 237,000 t Excluding the Mo in scrap, the demand in 2012 remained relatively stable at 237,000 t. Construction engineering steels accounted for 43% of Mo use, followed by stainless steel (22%) and chemicals (12%). Compared to the Mo consumption including Mo from scrap, there are quite substantial differences: engineering steels have a higher share in primary Mo use than in Mo including scrap, due to the low portion of Mo coming from scrap. In case of stainless steel, it is the opposite: mills are looking for high Mo scrap ratios. Thus, the level of primary Mo use in stainless steel is lower than the total Mo use including scrap (22 % compared to 26 % share in total use). Mo first use in engineering steels grew by 3% in 2012, while the rest of the segments remained stagnant (stainless steel) or even declined (all others). SMR Steel & Metals Market Research 2013 Page 3

5 Regional Comparison Mo Production Ore/Concentrate Mo First Use Primary Mo Use at Mills and in Metal / Chemical Production Mo End Use Consumption in End Use Segments at Fabricators and Consumers ROW 6% Other Asia 15% ROW ROW 8% 11% Europe 21% Europe 26% Other Asia 16% China 39% America 55% China 36% America 15% China 31% America 21% 241,000 t Primary Mo 237,000 t Primary Mo 322,000 t Primary Mo and Mo from Scrap From a regional point of view, there are several differences in the Mo supply chain from production to end use. The production (here related to the stage of ore/concentrate production) is mainly split between two regions: America (USA, Canada, Mexico, Peru and Chile) and China, with China already accounting for 39% of total production in The regional first use shows regions where Mo (excluding Mo in scrap) is employed for melting. China has substantially increased its share in the last five years to 36% now. Europe, although not a producing region, is ranking second with 26%. China s lower share in end use than in first use has two main reasons. Firstly, China has a high share of primary material used in production (first use), but a low share of scrap compared to other countries. Secondly, China became an exporter for some Mo containing products such as equipment, mechanical engineering and tools in the last years. Europe is a net exporter of Mo containing products, while America is a net importer. SMR Steel & Metals Market Research 2013 Page 4

6 Enduse Structure The chart below shows the end use industries for Mo containing steels, alloys and chemicals. Aerospace & Defence 4% Electronics & Medical 2% Others* 5% Building / Construction 6% Oil and Gas (incl. Catalysts, Refinery) 20% Power Generation 7% Other Transportation 8% Chemical/Petrochemical 14% Process Industry (excl. CPI) 8% Mechanical Engineering 13% Automotive 13% Total End Use 321,600 t The five largest end use segments in 2012 were: Oil and gas Chemical / petrochemical Automotive Mechanical engineering Process industry (excluding CPI) Compared to the last issue, the volume assigned to the oil and gas segment is substantially larger now, which is, however, not only caused by a stronger market. A major take-away from SMI s report on CRAs in oil & gas was that some sub-segments have been under-estimated in the previous report (particularly the demand for OCTG). On the other hand, CPI was most likely over-estimated in the previous reports. Thus, the quantities for Mo in stainless and engineering steel have been re-adjusted accordingly in this issue. SMR Steel & Metals Market Research 2013 Page 5

7 The oil and gas market including refineries and refinery catalysts was the largest segment with a share of 20% in all Mo end uses. Total demand in oil and gas has reached almost 64,000 t last year. Major applications were: OCTG products especially alloy engineering steels (16,600 t), refinery catalysts (18,200 t), flowlines including gas pipelines (9,500 t) and topside processing equipment (8,100 t). Chemical process industry (CPI) including petrochemical equipment is again ranking second with around 14% of all end uses (~45,200 t). Stainless steel applications (such as 316, Duplex and 6-Mo grades) are dominant in this segment with a tonnage of ~30,000 t. The main products are pipes and tubes as well as tanks, columns, vessels and similar equipment. Automotive is the third largest sector with 13% share (43,000 t), defending its position despite a falling Mo use in the European market. The main passenger car applications for Mo are power train applications (12,400 t) including clutch, gear and tools, followed by engine and exhaust parts (9,400 t) including crankshafts, piston rods and exhaust systems. Chassis parts and transport containers are the most important elements in trucks and buses. In the field of mechanical engineering, Mo use reached ~41,500 t. Mo containing alloy steel is used primarily in heavy machinery, printing, wood working, recycling, milling and for bearings, while alloy tools steels are used for tools and moulds. All other segments account individually for less than 10%: process industry (excluding CPI), other transportation (shipbuilding, railway, offshore vehicles and cranes), power generation (fossil power, nuclear, wind energy, other renewable), architecture, building and construction, aerospace and defense, consumer goods, electronics and medical (with a high Mo-Metal share). SMR Steel & Metals Market Research 2013 Page 6

8 Mo Use in t 75,000 70,000 65,000 60,000 55,000 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Total End Use 321,600 t Chemicals Cast Iron Mo-Metal ATS / HSS Super Alloys Stainless Steel Constructional Eng. Steel * incl. Pigments, Coatings and Lubricants Summing up, it can be said that Mo has a well balanced and stable end use structure compared to many other raw materials. The split between capital goods and consumer products is approx. 75:25. It includes late, mid- and early cyclic industries. This healthy structure ensures sustainable future growth and limits recession risks as well. Nevertheless, substitution risks will always remain an issue, as Mo is a comparatively expensive material and only used where it is absolutely necessary. SMR Steel & Metals Market Research 2013 Page 7

9 Mo Input in t (Mo Content) Forecast to 2022 Growth Potential for Mo (incl. Mo in Scrap) until ,000 ACTUAL FORECAST 400, ,000 Crisis and Post-Crisis GR (07-12): 4.2% p.a. Forecast GR (12-22): 3.3% p.a. 300, , ,000 China Growth GR (00-07): 4.5% p.a. End Use End Use Forecast As mentioned before, Mo (including Mo in Scrap) will grow by 3.3% p.a. to around 433,000 t in Compared to the previous forecast, the Mo demand has been revised (up) due to a higher basic value in In the previous forecast, a negative growth has been expected for The following graph shows the development in the Mo first uses until Chemicals and foundries will grow below the average, while the other segments (stainless steel, engineering steels, nickel alloys, tool steels, Mo- Metal) will increase above 3.3% p.a. The low growth of chemical applications is connected with the limited growth of refinery catalysts (longer lifetime expected, no substantial growth of refinery capacities and petrol production worldwide). SMR Steel & Metals Market Research 2013 Page 8

10 in metric t 450, ,000 Mo-Metal Foundries Chemicals Engineering Steels Nickel Alloys Tool Steel Stainless Steel GR in % 4,5 % 3,5 % 350,000 3,3 % 3,8 % 300,000 1,0% 250, ,000 3,5 % 150, ,000 3,5 % 50,000 Average Growth: 3.3% p.a The following end use segments are expected to grow above the average by 2022: Mechanical engineering Other transportation Consumer goods / electronics / medical equipment Power generation Process industry Building/construction SMR Steel & Metals Market Research 2013 Page 9

11 Mechanical Engineering Other Transportation Growth in % Consumer Goods / Med. / Electr. Power Generation Process Industry Building & Construction O/G: Exploration/ Prod./ Processing O/G:Refinery / Catalysts Automotive Aerospace / Defense Chemical / Petrochemical Industry Others 5.0% 4.5% 4.0% 3.5% Average Growth - All Segments 3.0% 2.5% 2.0% Total Oil & Gas 1.5% 1.0% 0.5% 0.0% *) incl. Mo in Scrap Mo Use in t (2012) SMR Steel & Metals Market Research 2013 Page 10

12 Regional Demand (incl. Mo in Scrap) The charts above compare the regional consumption of Mo on an end use basis in 2012 and ten years later in It is estimated that China (4.2% p.a.) and ROW including Russia, India, Africa and the Middle East (4.8% p.a.) will grow above the average by 2022, with some growth deceleration for China starting with However, today, China s potential lies in higher Mo use in certain high end applications such as aerospace as well as in process equipment, oil and gas, automotive and other transport. ROW consists of emerging countries with low Mo use today. The per capita Mo consumption here will improve in the next years from its current low 13 gram (compared to the world average of 46 grams) to ~20 gr. Europe, America and Other Asia with a high share of industrialized countries will also grow by 2 3% per year until Even though Europe s share in total demand will decline, its Mo consumption will increase volume-wise from 68,000 t in 2012 to over 80,000 t in 2022 which corresponds to a 2.2% average annual growth. SMR Steel & Metals Market Research 2013 Page 11

13 Mo Units in t Additional Mo Units Used by ,000 40,000 35, vs % WORLD 30,000 25, kt + 35% 20,000 ROW 15, % 10,000 5, % +28% +19% Incl. Mo in Scrap 0 China Americas Other World Other Asia Europe The graph above shows the increase in Mo consumption by region over a 10- year period and can be less misleading than the average annual growth rate figures. Even Europe, which has a low average annual growth rate, is expected to consume 20% more Mo (or almost 15,000 t) than in Other regions will increase by 30 to 60% by 2012, with China being the clear leader. Its extravolume will amount to over 40,000 t which is 44 % more than its consumption in SMR Steel & Metals Market Research 2013 Page 12