A new report from Swiss bank UBS (NYSE: $UBS) says that global %Steel production declined 7% year-over-year in August.
The worldwide decrease was driven by a 13% decline in China, where steel output has ground to a halt due to a prolonged slump in the country’s property sector.
However, UBS qualified its findings, noting that while global output decreased last month, steel production outside of China actually rose 2% year-over-year.
That increase was due to production increases across the European Union and South America, said UBS in its report. North America saw a decrease in August steel production.
The analysts at UBS estimate that global steel utilization fell by five percentage points in August from July of this year, reaching about 70%.
Looking ahead, UBS analysts see several factors that could influence the steel market and prices.
In the U.S., steel prices are on a rebound, having risen to $720 U.S. per ton from lows of $645 U.S. a ton seen in July.
In Europe, the steel market is seeing an influx of cheaper imports that could negatively impact prices in the near-term.
On the bright side, UBS expects that declining interest rates in the U.S. and economic stimulus measures in China could help to boost demand for steel products leading into 2025.
