European stainless steel crude steel production has continuously improved to a level of ~700,000 t per month in the first months of 2011 but has then dropped substantially to 450,000 - 550,000 t in the third quarter.

This year‘s European production will end on a similar level as in 2010 (7.4 mill. t). In Q1/12 we will most likely see an increased production volume as mill-internal stocks will have to be increased (with the exception of Outokumpu).

European Mills suffered from low profitability due to falling surcharges and base prices since Q2/11. Despite a recent stabilization of mill base prices, it is expected that flat producers will remain in a very difficult financial situation for the rest of this year.

Outokumpu Stainless: Operating loss of 53 million € (Q2/11: -169 mill. €) including raw material-related inventory losses of some 38 mill. € (Q2/11: -26 mill. €). Deliveries fell to 340 kt (Q2/11: 348 kt). Sales: 1.23 bn € after 1.28 bn € in the previous quarter. Outokumpu has agreed to a joint venture between Outokumpu and Italy’s Tubinoxia for OSTP. Tubinoxia will buy 36% of OSTP (option: 51% within 3 years). Outokumpu plans further to reduce working capital by 250 mill. € by bringing inventory days closer to 90 days by mid-2013 (from now ~110 days) and streamline its distribution network. It is planned to cut 1,300 jobs (Finland: 300, Sweden 600).

Inoxum: In contrast to earlier reports, an Inoxum-IPO is still an option for ThyssenKrupp. German media reported earlier that an IPO is not an option anymore due to weak stock exchange markets. But at the moment the board of ThyssenKrupp is evaluating several offers received from private equity firms as well as industrial groups.

Acerinox Group: The company achieved profits after taxes and minorities of 1 million € in Q3/11 at net sales of 1.06 bn € in the same period. Losses at Acerinox Spain and Columbus have been compensated by a profit of ~20 mill. € at NAS (USA). Acerinox expects to reach a positive result in Q4/11 in a stagnant market.

Aperam recorded an EBITDA of 62 mill. USD (but net loss of 41 mill. USD) at sales of 1.5 bn USD in Q3/11. They will focus on further industrial optimization and rationalization in Europe to reduce working capital. Aperam has broken ground on a 45 mill. € investment in a new hot annealing and pickling line at Gueugnon (France) with a capacity of 520 kty. The new HAPL (production start expected for Q3/12) will replace two old lines.