As per a report in Manila Standard Today, Philippines steel makers expect supply to tighten in the country due to the decision of global manufacturers of steel raw materials to cut down on production by at least 15% over the next 6 months.
Mr Jesus Arranza president of the Federation of Philippine Industries said that the galvanizers were the most worried as they import about 92% of their requirements for cold rolled coils.
Mr Arranza said that analysts estimated that there could be a 15% cut in annual global production of crude steel over the next 6 months to attune the output with the demand and help stabilize prices to reasonable levels.
He said that local producers as a result were predicting a tight supply of finished steel products by the first quarter of 2009 due to the shortage of raw materials such as CRC, hot rolled coils and slabs. He added that "We are alerting the public on this probable scenario as reported by the FPI members in the steel industry."
He further added that ArcelorMittal was cutting fourth quarter production by 9 million tonnes from the third quarter volume of 29 million tonnes. Another Indian steel maker TATA Corus Steel will trim its output by 20% up to March 2009, while Baosteel will cut production by 1 million tonnes over the next 3 months.