As I write this, $2.7 trillion was wiped from global equity markets in one day, with the Dow Jones industrial average suffering from the largest ever intra-day slide and the JSE all share index being down 15% from the record closing high set in April. On top of this, commodity prices had just slumped to their lowest level since the end of the 20th century, according to a widely used Bloomberg index. On the currency front, the rand had tumbled to fresh lows against both the US dollar and British pound.
In this extremely challenging global and local economic environment, the South African stainless steel industry is facing strong headwinds. Stainless steel apparent consumption (SSAC) for the first six months of this year recorded a 5.5% year-on-year drop. This is on top of the 4.8% contraction in SSAC seen in 2014 and the 5.9% contraction seen in 2013. However, the 2014 SSAC figure is up by 4.7% on that seen in 2008.
In contrast, according to the International Stainless Steel Forum (ISSF), Chinese stainless steel production has more than tripled from 2008 to 2014, while production in the rest of the world has only grown by 3.7% in the same period. However, there has been a dramatic slow-down in the first quarter of this year with year-on-year global production only increasing by 0.1%, with Chinese production contracting by 1.4% and Western Europe/Africa contracting by 7.3%. Only the Americas and Asia (excluding China) saw growth for the year-on-year first quarter figures of 14.7% and 6.0% respectively.
Many people believe that in uncertain economic times, the best thing to do is just ride it out and survive. However, the sassda team (pictured below) is putting into action our plans to market and promote stainless steel as we endeavour to grow the local stainless steel conversion industry. We believe that it’s important to focus on what’s right with the world and our industry and that a positive attitude will lead to