Competitiveness ranking of world-class steel companies released
World Steel Dynamics (WSD) released the latest issue of the competitiveness ranking of world-class steel companies in November this year. South Korea’s Pohang continues to rank first and has ranked first in the competitiveness of global steel companies for 12 consecutive years. Compared with last year, there are a total of 35 companies that have entered the competitiveness ranking of world-class steel companies this year. The number and the companies themselves have not changed, but the ranking has changed significantly.
WSD stated in the report that the overall improvement in financial performance of these 35 steel companies is unprecedented, reflecting the improvement in global demand and rising steel prices. 17 of the 35 companies have a net debt to EBITDA ratio of less than 0.5, of which 23 companies have a figure of 1.0 or lower. On the other hand, the number of companies in “expansion” mode can be said to be the lowest since WSD started publishing these rankings. This undoubtedly reflects the oversupply of global steel production capacity. In fact, this situation was already obvious before the outbreak of the new crown pneumonia epidemic. WSD said that for future rankings, it is considering adding new indicators or adjusting individual indicators, because the “green steel revolution” redefines the meaning of “world-class steel manufacturer“.
As the most competitive steel company in the world, POSCO has 23 scoring items in terms of high value-added products, conversion costs and benefits, technological innovation capabilities, advantages in skilled workers, assets and liabilities, downstream business, mergers and acquisitions and joint ventures, Eight aspects including location risk factors all received a full score of 10 points, one more than last year’s balance sheet full score item; the scores of other indicators are the same as last year. In the end, the company continued to hold the lead with a weighted average score of 8.54 points, which was higher than last year’s score (8.42 points).
Compared with last year, the top ten steel companies in competitiveness have undergone major changes. This year Pohang, Nucor, Seville, and New Steel continue to rank in the top four; Baowu of China jumped from 11th to 5th last year; voestalpine fell from 5th last year to 9th; Japan Ironworks moved one place to seventh place from sixth place last year; ArcelorMittal swapped positions with Japan Steel and moved forward one place to seventh place; Steel Power Company was the same as last year. The eighth place; Jindler Southwest Steel Company dropped out of the top ten, falling from ninth last year to twelfth place; Evraz’s ranking also dropped from last year’s top ten companies and dropped sharply to No. 17; Tata Steel entered the top ten from the 12th place last year, ranking tenth.
Among the steel companies included in this year’s world’s most competitive ranking, there are four companies in China (Mainland), the United States, India, and Russia, three in Brazil, and two in Japan and South Korea. The four steel companies included in the rankings of China (Mainland China) are: Baowu (score 8.04, ranking fifth), an increase of 0.44 points from last year’s weighted average score, ranking up six places; followed by Anshan Iron and Steel (6.93 points, ranking fifth). 28), the score increased by 0.1 points, and the ranking dropped by three points; Maanshan Steel (6.57 points, ranked 33rd), the ranking remained unchanged, the score increased by 0.35 points; Shagang (6.14 points, ranked 35th), the score fell by 0.03 points , The ranking drops one place.
After ranking tenth in competitiveness in 2017, Baowu Group has once again entered the top ten ranking of global steel enterprises in four years. It is the same as the ranking in 2012, where it entered the top ten for the last time before 2017. Five. Compared with Pohang, which ranks first in competitiveness, from the perspective of scoring factors, Baowu scores 10 points in terms of scale, capacity expansion, and proximity to downstream users, while Pohang scores 9 points and 8 points respectively. Baowu’s balance sheet, mergers and acquisitions, alliances, and joint ventures have the same scores as POSCO. They have a full score of 10. However, in the domestic market, they have pricing power, high value-added products, switching costs and benefits, and cost reduction capabilities. There is still a gap in the scores of factors with higher weights, such as technological innovation ability, ownership of iron ore, downstream and non-steel businesses. In addition to Baowu Group, the three Chinese steel companies included in the evaluation are still relatively low. It is worth mentioning that in the domestic market pricing power indicators of the four Chinese steel companies on the list, with the exception of Baowu Group’s score of 7 points, Anshan Iron and Steel, Maanshan Iron and Steel and Shagang all scored 3 points. The score in this index is the bottom, which shows to a certain extent that on the one hand, companies lack competitive products or exclusive products, on the other hand, the concentration of my country’s steel industry is still low, and the pace of mergers and reorganizations needs to be accelerated.
In general, Chinese steel companies still need to find and improve their weak links in terms of high value-added products, technological innovation capabilities, and resources, and continue to enhance their competitiveness. In particular, the “green steel revolution” is pushing the urgency of “technical innovation” to a new frontier, and technological leadership will become a magic weapon for steel companies’ mid- to long-term survival and success.