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Kallanish Kallanish

Knowledge matters Knowledge matters

November, 28th 2020

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APR 16
14:42

worldsteel expects growth in global short-range steel demand

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The World Steel Association (worldsteel) has released its April 2019 short-range outlook. In a note sent to Kallanish, the association says that worldsteel global steel demand will reach 1,735 million tonnes in 2019, an increase of 1.3% over 2018. In 2020, demand is projected to grow by 1.0% to reach 1,752mt.

“In 2019 and 2020, global steel demand is expected to continue to grow, but growth rates will moderate in tandem with a slowing global economy. Uncertainty over the trade environment and volatility in the financial markets have not yet subsided and could pose downside risks to this forecast,” says worldsteel Economics Committee chairman Saeed Al Romaithi.

Global steel demand increased by 2.1% in 2018 and grew slightly slower than in 2017. “In 2019 and 2020 growth is still expected, but in a less favourable economic environment. China’s deceleration, a slowing global economy, and uncertainty surrounding trade policies and the political situation in many regions suggest a possible moderation in business confidence and investment,” worldsteel adds.

In China the government is likely to heighten the level of stimulus, which is expected to boost steel demand in 2019. A minor contraction in Chinese steel demand is anticipated for 2020 as the stimulus effects are expected to subside.

Steel demand in the developed economies is forecast to further decelerate to 0.3% in 2019 and 0.7% in 2020, reflecting a deteriorating trade environment.  In 2019, the US growth pattern is expected to slow with the waning effect of fiscal stimulus and a monetary policy normalisation. Brexit tensions amongst other factors will also slow economic growth in Europe in 2019, but steel demand is expected to improve in 2020. Japan and Korea are also expected to see reduced steel demand in 2019 and 2020.

For the world’s developing economies excluding China, steel demand is expected to grow by 2.9% and 4.6% in 2019 and 2020 respectively.