Hans Jürgen Kerkhoff President Wirtschaftsvereinigung Stahl Vorsitzender Stahlinstitut (VDEh), Germany commenting on the performance of the German steel industry said output in the first half of 2011 had been strong but this faultered in the second half of the year.

However, output increased once again in January 2012 compared with December 2011 to 3.8Mt, the highest level since March 2010.

Order levels are risen and in February were 20% higher that the level at the same period in 2011.

According to the Munich-based IFO economic research institute for the steel industry there is an upward trend in orders. Fears that a similar crisis to that of the winter of 2008/2009, have not materialised.

The positive trend of recent weeks was also driven by the inventory cycle. Inventories fell in the trading and steel service centres in Germany in December to a very low level, and the distribution sector in particular is currently re-stocking.

Business associations representing steel-user industries expect further growth in 2012:
• The Association of the Automotive Industry (VDA) for passenger cars reports output increased by 2%.

• The trade association for steel and metal processing (WSM) forecasts an increases in production of up to 4%.

• The Confederation of German Construction Industry expects a sales growth of 1.5% and;

• The Association of German mechanical and plant engineering (VDMA), while recently lowering its forecast for 2012, still expects production at a very high level.

Against this background, VDEh predict that steel demand will remain robust in Germany during 2012, although some slowing is expected. Crude steel production is expected to reach 44.0Mt just below the level of 44.3Mt in 2011.