orldsteel Sees 5.8% YoY Growth in Finished Steel Demand in 2021
The World Steel Association has released its Short Range Outlook for 2021 and 2022. worldsteel forecasts that steel demand will grow by 5.8% in 2021 to reach 1,874.0 million tonnes, after declining by 0.2% in 2020. In 2022 steel demand will see further growth of 2.7% to reach 1,924.6 million tonnes. worldsteel Economics Committee chairmen Mr Al Remeithi said “Despite the disastrous impact of the pandemic on lives and livelihoods, the global steel industry was fortunate enough to end 2020 with only a minor contraction in steel demand. This was due to a surprisingly robust recovery in China, with growth of 9.1% whereas in the rest of the world steel demand contracted by 10.0%. In the coming years, steel demand will recover firmly, both in the developed and developing economies, supported by pent-up demand and governments’ recovery programmes. However, for most developed economies a return to the pre-pandemic levels of steel demand will take a few years. While it is hoped that the worst of the pandemic is passing, there is still considerable uncertainty for the rest of 2021. The evolution of the virus and progress of vaccinations, withdrawal of supportive fiscal and monetary policies, geopolitics and trade tensions could all affect the recovery envisaged in this forecast. For the future, structural changes in a post-pandemic world will bring about shifts in steel demand shape. The steel industry will see exciting opportunities from rapid developments through digitisation and automation, infrastructure initiatives, reorganisation of urban centres, and energy transformation. All at the same time as the industry is responding to the need to produce low-carbon steel.”
Region Wise Finished Steel Demand Forecasts 2021
1. European Union (27) + UK - 154.9 million tonne, 10.2% YoY
2. Other Europe - 42.3 million tonne, 17.4% YoY
3. CIS - 60.2 million tonne, 3.4% YoY
4. USMCA - 122.6 million tonne, 7.6% YoY
5. Central and South America - 42.7 million tonne, 10.6% YoY
6. Africa - 38.6 million tonne, 8.3% YoY
7. Middle East - 48.5 million tonne, 5.4% YoY
8. Asia and Oceania - 1,364.2 million tonne, 4.7% YoY
9. World - 1,874.0 million tonne, 5.8% YoY
Source – worldsteel SRO April 2021
Top 10 Steel Using Countries Finished Steel Demand Forecasts 2021
1. China - 1,024.9 million tonne, 3.0% YoY
2. India - 106.1 million tonne, 19.8% YoY
3. United States - 86.5 million tonne, 8.1% YoY
4. Japan - 56.0 million tonne, 6.5% YoY
5. South Korea - 51.5 million tonne, 5.2% YoY
6. Russia - 43.8 million tonne, 3.0% YoY
7., Germany - 34.0 million tonne, 9.3% YoY
8. Turkey - 35.0 million tonne, 18.7% YoY
9. Vietnam -24.5 million tonne, 5.0% YoY
10. Mexico - 23.4 million tonne, 7.5% YoY
Source – worldsteel SRO April 2021
The current forecast assumes that the on going second or third waves of infections will stabilise in the second quarter and that steady progress on vaccinations will be made, allowing a gradual return to normality in major steel-using countries.
Main Steel Using Segments
1. Construction - Diverging trends among the construction subsectors will emerge from the pandemic. With increased remote working, e-commerce, and reduced business travel, demand for commercial buildings and travel-related facilities will continue to see a downward trend. At the same time, demand for logistics-related facilities to support e-commerce has increased and will continue to be a growth sector. Infrastructure projects have become important and are sometimes the only tool in many countries for economic recovery. They will continue to be a strong driver in emerging economies. In developed economies, green recovery programmes and infrastructure renewal will drive construction demand. Global construction is expected to reach the 2019 level again in 2022.
2. Automotive - The automotive sector is expected to recover strongly in 2021. The recovery will be driven by pent-up demand, increased use of personal transportation due to safety concerns, and increased household cash savings. The recovery is expected to be particularly strong in the US, where the production level in 2021 will exceed the 2019 level. The global automotive industry is expected to return to the 2019 level in 2022. Despite a faster than expected recovery in demand, the sector is encountering another supply chain bottleneck in early 2021 with a shortage of semiconductors and other parts, which could constrain the recovery potential.
Source - Strategic Research Institute