Presentation is loading. Please wait.

Presentation is loading. Please wait.

TITLE 16 MAY 2012 KATOWICE CONFERENCE 2012 : A CHALLENING YEAR JUERGEN NUSSER MANAGING DIRECTOR.

Similar presentations


Presentation on theme: "TITLE 16 MAY 2012 KATOWICE CONFERENCE 2012 : A CHALLENING YEAR JUERGEN NUSSER MANAGING DIRECTOR."— Presentation transcript:

1 TITLE 16 MAY 2012 KATOWICE CONFERENCE 2012 : A CHALLENING YEAR JUERGEN NUSSER MANAGING DIRECTOR

2 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 2 16 MAY 2012 KATOWICE EUROMETAL presentations may include forward-looking information and statements about the steel sector (production, distribution, consuming industries and their stake-holders). Forward- looking statements are not historical facts but have to include financial or other projections & estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. For EUROMETAL, expectations reflected in such information and statements are reasonable. Any third parties are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of EUROMETAL, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Consequently EUROMETAL denies all responsibility regarding the said informations and statements undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise. ABOUT EUROMETAL PRESENTATIONS DISCLAIMER

3 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 3 HELP ABOUT EUROMETAL PRESENTATIONS The full content of EUROMETAL presentations may be seen only in the presentation mode as single slides may have several animated elements covering each other. Because of this, the presentations as a rule are not suitable for printing. The presentation runs automatically until the icon appears in the bottom line and asks for a mouse click to proceed. Otherwise the presentations can be navigated by hyperlinks activated with the following icons in the bottom line: Please note also the disclaimer on slide 2 You are kindly asked to respect the Copyright of EUROMETAL and contact before any other than personal use Next slide Previous slide Go to final slides or end Back to last slide seen Go to slide (Help) Go to slide (Agenda) Go to content indicated

4 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE : A CHALLENING YEAR AGENDA EUROPEAN ECONOMIC CONGRESS ABOUT EUROMETAL EUROPEAN ECONOMICS STEEL PARAMETERS PRICING POWER SHIFTS OUTLOOK 2012

5 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 5 ABOUT EUROMETAL ASSOCIATION OF EUROPEAN DISTRIBUTORS OF STEEL, TUBES AND METALS EUROPEAN STEEL TRADING STUDY GROUP EUROPEAN ASSOCIATION OF FLAT STEEL SERVICE CENTERS FEDERATION OF EUROPEAN NATIONAL ASSOCIATIONS OF STEEL, TUBE AND METAL DISTRIBUTION COVERING ALL ASPECTS & TYPES OF STEEL INTERMEDIATION IN THE EUROPEAN UNION AND BEYOND GROUPS & COMPANIES MORE THAN EMPLOYEES MORE THAN 80 MLN TONNES OF SALES 24 OCTOBER 2011: IMPLEMENTATION OF THE NEW EUROMETAL

6 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE : A CHALLENING YEAR JUERGEN NUSSER MANAGING DIRECTOR 16 MAY 2012 KATOWICE EUROZONE GDP SEASONALLY ADJUSTED UNEMPLOYMENT MARCH 2012 SEASONALLY ADJUSTED... WITH THE EUROZONE MOVING TOWARDS RECESSION... WITH UNEMPLOYMENT IN EUROPE REACHING A RECORD LEVEL... WITH INCREASING RELOCATION AND TECHNOLOGY TRANSFER... WITH THE EUROZONE FINANCIAL STATUS DETERIORATING... WITH LATEST ELECTION RESULTS CREATING NEW UNCERTAINTIES... AND WITH A GLOBAL ECONOMY GOING CRAZY? 2012: A CHALLENING YEAR... MARKET CAPITALISATION USD ??

7 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 7 SINCE Q4/2008 WE WE HAVE SEEN RECOVERY - BUT... EUROPEAN ECONOMICS

8 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 8 IN 2012 FINANCIAL PARAMETERS RULE THE ECONOMIC WORLD EUROPEAN ECONOMICS

9 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 9 27 FEBRUARY 2012: PUBLICATION OF THE EEAG REPORT 2012 NOT REALLY AN ENCOURAGING OUTLOOK FOR 2012 EUROPEAN ECONOMICS

10 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 10 A MACROECONOMIC RECESSION INTENSIFIES STRUCTURAL CHANGE OF INDUSTRIAL PRODUCTION HARDLY EVER AGAIN REACHING THE FORMER LEVEL ECONOMIC CYCLE STRUCTURAL CHANGE IN MATURE AND SATURATED ECONOMIES THE SHORT TERM UPSWINGS AND DOWNSWINGS OF THE MACROECONOMIC CYCLE SLOW DOWN OR SPEED UP CONTINUOUS AND LONG TERM STRUCTURAL CHANGE EUROPEAN ECONOMICS DIFFERENCE BETWEEN ECONOMIC CYLES AND STRUCTURAL CHANGE

11 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE TO REACH MTO IN 2010 (14% Y-O-Y) 1.2% pa 7,1% pa 14% pa IN MLN TO STEEL PARAMETERS GROWTH OF GLOBAL STEEL DEMAND CONTINUES...

12 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE IN WHICH EUROPEAN STEEL DEMAND HAS ALMOST NO PART BUT STRUGGLES TO COME BACK TO HISTORIC AVERAGES IN MLN TO STEEL PARAMETERS

13 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 13 DOWNWARD TREND OF GLOBAL CRUDE STEEL PRODUCTION STEEL PARAMETERS MLN TONS ? GROWTH TREND BEFORE 2008 RECESSION RECOVERY TREND AFTER RECESSION DOWNWARD TREND SINCE MAY 2011 CRISIS TREND INTO 2008 RECESSION CRU WORLD STEEL CONFERENCE LONDON FEBRUARY 2012 A CONSEQUENCE OF A NEGATIVE TREND OF GLOBAL STEEL CONSUMPTION

14 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 14 CHANGE IN % Y-O-Y COULD THIS BE A DEJA VUE EXPERIENCE ? INDUSTRIAL PRODUCTION IN EU-27 HAS TURNED TO ZERO STEEL PARAMETERS

15 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 15 WINNERS, SURVIVORS AND LOSERS IN THE PAST FIVE YEARS - 10 % + 6 % + 10 % + 5 % + 14 % + 28 % + 23 % CHINA, LATIN AMERICA AND THE MIDDLE EAST ARE THE UNCONTESTED WINNERS THE MATURE ECONOMIES EU AND NAFTA ARE THE CLEAR LOSERS - 20 % 2011 APPARENT STEEL USE, FINISHED PRODUCTS AS COMPARED TO HIGH CYCLE 2007, IN % AFRICAMID EASTEU-27CHINAASIA-PCFLATIN.AMCISNAFTAOTHER EUWORLD + 63 % + 21 % STEEL PARAMETERS

16 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 16 THE EUROPEAN UNION IS NO MORE A WINNING MARKET - 44 % - 17 % + 3 % + 21 % - 7 % STAGGERING LOSSES IN MAIN EU MARKETS SPAIN, UK, ITALY AND FRANCE CHARACTERISE THE EUROPEAN PICTURE ONLY POLISH STEEL CONSUMPTION IS EXPECTED TO COMPLETELY RECOVER FROM LAST YEARS CRISIS - 26 % - 23 % - 20 % 2011 APPARENT STEEL USE, FINISHED PRODUCTS AS COMPARED TO HIGH CYCLE 2007, IN % FRANCEGERMANYUKPOLANDITALYSPAINEU - 27WORLD STEEL PARAMETERS

17 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 17 WILL STEELMAKING AND STEEL DISTRIBUTION BECOME A « CONVERTER » BUSINESS? RAW MATERIALS PRODUCERS STEEL PRODUCERS STEEL DISTRIBUTION STEEL END USERS STEEL PRICE HEDGING & RESALE IRON ORE SURCHARGE IRON ORE SPOT PRICING SCRAP SURCHARGE VOLATILE SCRAP PRICING ALLOY SURCHARGE VOLATILE METAL EXCHANGE PRICING SHORT TERM PRICE CONTRACTS MARKET PRICING IS LOSING IMPORTANCE TO SURCHARGE-MODELS, PRICE INDEXING AND HEDGING THE PROBABLE ANSWER TO THIS: PRICING POWER SHIFTS POWER SHIFT TO RAW MATERIALS KILLS MARKET PRICING

18 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 18 RAW MATERIALS PRODUCERS SHARE IN VALUE CHAIN ALLOCATION IS OVER 70 % OVER THE LAST STEEL CYCLE, VALUE ALLOCATION IN THE STEEL VALUE CHAIN DID SHIFT DRAMATICALLY TOWARDS RAW MATERIAL PRODUCERS PRICING POWER TURNING UPSTREAM 2004 STEEL COAL IRON ORE 2009 STEEL COAL IRON ORE 9 % 41% 9 % 31% 82% 28% POWER SHIFT FROM STEEL TO RAW MATERIALS PRODUCERS PRICING POWER SHIFTS

19 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 19 THERE ARE MLN TONS OF OVERCAPACITY IN EUROPE WITH REAL STEEL CONSUMPTION IN MATURE MARKETS DECLINING EXCESS CAPACITY OF STEEL PRODUCTION COULD ASK FOR PRICE CONCESSIONS PRICING POWER TURNING DOWNSTREAM? UNUSED CAPACITY USED CAPACITY STEEL PRODUCTION SUSTAINABLE DEMAND STEEL CONSUMPTION PRICING? PRICING POWER SHIFTS POWER SHIFT FROM STEEL PRODUCERS TO STEEL END USERS?

20 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 20 A SIGNIFICANT TREND TO A STRUCTURAL MARGIN SQUEEZE SUCH A DEVELOPMENT WOULD OF COURSE HEAVILY AFFECT STEEL DISTRIBUTION STEEL PRODUCERS LEFT WITHOUT ANY PRICING POWER? PRICING POWER SHIFTS

21 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 21 CONSIDERING THE IMPLEMENTED CAPACITIES AND SUSTAINABLE DEMAND ALSO FOR EUROPEAN STEEL DISTRIBUTION PRICING POWER SHIFTS PRICE PRESSURE DISTRIBUTION CAPACITY 230 MLN TONS SUSTAINABLE DEMAND 160 MLN TONS 110 MLN TONS DISTRIBUTION A SIGNIFICANT TREND TO A STRUCTURAL MARGIN SQUEEZE

22 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 22 EUROPEAN STEEL WILL ONLY MOVE AT A SLOW PACE F 174 F APPARENT DEMAND OF FINISHED STEEL PRODUCTS IN MLN TONNES: EU ALBANIA & FORMER YUGOSLAVIA A DIFFICULT RECOVERY TO THE LONGTERM HISTORIC LEVEL AFTER A REAL BUBBLE AND THE FOLLOWING STEEP DECLINE ? OUTLOOK 2012

23 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 23 EUROPEAN STEEL WILL ONLY MOVE AT A SLOW PACE EXAMPLE: FLAT PRODUCTSSINCE THE 2008 CRISIS, THE RELATIVE WEIGHT OF DIRECT SALES OF EUROPEAN PRODUCERS TO END USERS HAS DECLINED TO THE BENEFIT OF THE DISTRIBUTION SEGMENT. THIS TRANSLATES A NEED OF THE END USERS FOR IMPROVED SERVICES DRIVEN BY A MORE STRINGENT WORKING CAPITAL REQUIREMENT. HOWEVER, THE BUSINESS MODEL OF THE DISTRIBUTION SEGMENT CREATES MORE VOLATILITY IN THE APPARENT DEMAND AND PRICING. OUTLOOK 2012

24 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 24 DISTRIBUTION - 2 MLN TO END USERS - 2 MLN TO 147 MLN TO ?? EUROPEAN APPARENT DEMAND OF FINISHED STEEL PRODUCTS 158 MLN TO APPARENT DEMAND 2011 APPARENT DEMAND 2012 THE MISSING RESTOCKING THE SOVEREIGN DEBT CRISIS AND SLUGGISH INDUSTRIAL PRODUCTION COULD LEAD TO A SIGNIFICANT DECREASE OF APPARENT DEMAND POSSIBLE LOSSES IN DEMAND POSSIBLE LOSSES BY DESTOCKING HOPEFULLY THIS WILL REMAIN A WORST CASE SCENARIO! OUTLOOK 2012 THE FORECASTED 2012 APPARENT DEMAND COULD BE ENDANGERED AUTOMOTIVE - 1,5 MLN TO OTHERS - 2 MLN TO MACHINERY - 3,5 MLN TO

25 EUROPEAN ECONOMIC CONGRESS 16 MAY 2012 KATOWICE © JUERGEN NUSSER, MD EUROMETAL 2012 : A CHALLENGING YEAR SLIDE 25 EUROPEAN ECONOMIC CONGRESS DEFINITELY YES!AT LEAST PARTLY YES!MOST LIKELY YES!.... A CHALLENGE ALSO FOR EUROMETALTHEREFORE BETTER PREPARE FOR SOME HASARDS AND EVENTUALLY POSSIBLE COLLISIONS! SO FINALLY - WHAT WILL WE HAVE TO FACE THIS YEAR?

26 TITLE 16 MAY 2012 KATOWICE CONFERENCE 2012 : A CHALLENING YEAR JUERGEN NUSSER MANAGING DIRECTOR THANK YOU FOR YOUR ATTENTION


Download ppt "TITLE 16 MAY 2012 KATOWICE CONFERENCE 2012 : A CHALLENING YEAR JUERGEN NUSSER MANAGING DIRECTOR."

Similar presentations


Ads by Google