Q3 results show dwindling UK steel production as several key European customer markets cut back on production and inventory.
According to data collected by UK Steel, a division of EEF, the manufacturer’ organisation, production fell by 7.3% to 179.3 thousand tonnes per week between July and September, compared to 193.4 thousand tonnes per week in the previous quarter.
It is believed that the decreasing figures come in response to continued negative business feeling within the industry.
Ian Rodgers, director of UK Steel said: “The summer holiday period is always relatively quiet but there is usually a distinct rebound. What is disturbing about these figures is that September output improved only slightly from August.
Mr Rogers said that the latest figures reflected nervousness across European markets. “Steel customers are keeping stock levels low with a knock-on impact on our output levels,” he said. “Whilst this impact should only be temporary it is clear that we cannot expect a strong rebound in the immediate future.”
These new figures follow two quarters of consecutive growth in steel production and highlight the extent to which recovery in core manufacturing and construction markets remains fragile.
The decrease also indicates that steel production has fallen back to the same level as the third quarter in 2010. This put production at 34% below the pre-recession level in the third quarter of 2008.
Rodgers concluded: “It is now essential that government implements a compensation package for energy intensive sectors such as Steel. This will help companies maintain their competitiveness and control their cost base through this uncertain phase in demand.”