Research and Markets: United Kingdom Metals Report - Q3 2009

DUBLIN--(BUSINESS WIRE)--Research and Markets (http://www.researchandmarkets.com/research/9eee2b/united_kingdom_met) has announced the addition of the "United Kingdom Metals Report Q3 2009" report to their offering. United Kingdom Metals Report provides industry professionals and strategists, corporate analysts, metals associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on the United Kingdom's metals industry. British metals producers are in serious trouble with drastic cuts in capacity and workforce expected as they struggle to cope with falling prices and rising costs at a time of exchange rate volatility and restricted credit conditions, according to this latest UK Metals Report. In the first five months of 2009, British crude steel output fell 42.6% year-on-year (y-o-y) to 3.55mn tonnes. In May, output was up nearly 15% month-on-month (m-o-m) but was still down 42% y-o-y at 773,000 tonnes. While the British steel industry may have reached a trough, it is not seeing any signs of a sustained recovery in output. Furthermore, our steel output forecasts have been revised down as the UK economy sinks further into recession, with GDP set to shrink 4.2% in 2009 and to stagnate in 2010. The economy will not return to its potential growth level until well into 2011. A deep and long recession is already having a negative impact on UK metals production capacities, with Corus radically cutting back steelmaking production while aluminium smelters close their operations. While the UK is faced with the same problems as the rest of the world, it also suffers from poor payment performance and suppliers reluctant to extend credit without insurance. Struggling with flagging orders, suppliers are forced into high risk lending and exposure to bad debt. This could exacerbate the problems facing the industry over the medium term, particularly as closures are expected in the supply chain. By 2010, the steel and aluminium industries, along with distribution and consumption, are likely to be very different and quite likely a lot smaller.