The German Steel Federation said that Germany's steel industry has been stabilizing since the start of the year after prices declined in the last quarter of 2011.
Mr Hans Juergen Kerkhoff president of German Steel Federation said that "Since the start of the year, indications are growing the steel industry in Germany has stabilized." He added that orders have risen and companies have also increased their crude steel output, while the level of backlog orders was around 20% higher than the year earlier figure.
The group, whose members include ThyssenKrupp and Salzgitter reiterated that output in Germany will not increase this year after experiencing two years of growth.
Mr Kerkhoff said that "Crude steel production in 2012 would likely be at around last year's high level of 44.3 million tonnes."
Steelmakers drastically cut their output in 2009 amidst a slump in prices, slashing production to 33 million tonnes from 46 million the year earlier.
Mr Kerkhoff said that "Fears that there could be a repeat of the 2008-09 crisis have no basis." He added that important customers, like carmakers, metal processors and builders in the construction industry expect to grow further in 2012.
Steel prices have weakened in the second-half of last year, with distributors destocking heavily as end clients adopted a wait and see stance to see how the euro zone debt crisis would affect the overall economy.
Mr Kerkhoff said some clients were now starting to replenish their inventories.
But some companies remained uncertain about the macroeconomic developments, with both ThyssenKrupp and Salzgitter refusing to provide a full year outlook due to poor visibility of what lies ahead.
Sourced from: Reuters