Domestic consumption of stainless steel grew by 29%, to 192 647 t in 2006, driven primarily by the many capital projects in progress in Southern Africa, the Southern Africa Stainless Steel Development Association (Sassda) said in a statement.
Increased demand was experienced from the transport, capital equipment and general engineering, architecture, building and construction industries.
During 2006, 42% of apparent domestic consumption was consumed by the transport sector, followed by engineering/capital equipment (18%), metal goods (17%), tube and piping (8%), and direct building and construction (4%), the association said.
Speaking at the Sassda annual general meeting last week, MD Michael Campbell said that local demand continued to be the primary growth driver for the stainless steel market and that, globally, the stainless steel market in 2006 was characterised by rampant demand, tight supply, and rising raw material costs.
“Since 2002 the price of nickel has increased from $4 200 to around $53 000 a ton. There have also been dramatic increases in other raw material prices which have lead to a sharp increase in the price of stainless steel,” Campbell reported.
As a result, Campbell said that while there have been experiments to try and substitute stainless steel, there had been no marked movement away from stainless steel.
He said the growth outlook for the local market remained positive, driven by strong demand and project activity within South Africa and the region.
“We maintain, and closely monitor, a pipeline of Southern Africa mega projects with a current aggregate value over the next decade or so of $55-billion, which principally includes the Gautrain, the Airports Company South Africa, the 2010 World Cup, petrochemicals (Sasol) and power generation (Eskom) projects. We continue to promote the use and development of stainless steel in all of these projects, and many more.”