Losing its metal?

The Polish economy is expected to consume less steel this year compared to previous years. According to the Katowice-based Polish Steel Association (HIPH), steel consumption in Poland for 2008, as of August, was 8.2 million tonnes, two percent lower than in the same period of 2007.

Due to the expected slowdown in Q4 for sectors of the economy which use steel, reaching the same level of steel consumption as in 2007 - 12 million tonnes - looks increasingly unlikely. At the beginning of this year, steel consumption was predicted to rise by half a million tonnes, a growth of five percent.

Moreover, the 2008 output from Polish steel mills will drop, although after three quarters of 2008 domestic steelworks were still reporting growth of 0.3 percent over 2007. According to Romuald Talarek, president of HIPH, Polish steel factories are predicted to close the year with a production output of 10-10.5 million tonnes of raw steel, compared to 10.6 million tonnes in 2007. Prior to the end of September, output had reached 8.1 million tonnes, while 60 percent of the steel used in Poland was imported.

Observers note that limited production is a result of decreased demand for steel. "While other steelworks have not reduced their output significantly, the total production output drop should not be more than five percent for this year," Talarek told the Polish Press Agency.