CONF: Worldsteel lifts global steel demand forecast
The newly-released numbers are higher than worldsteel’s prediction back in April when it expected global finished steel demand to grow by just 1.8% this year to 1.616 billion tonnes and rise by another 0.7% next year to 1.63 billion tonnes.
It was the underestimation of steel use in China last year supplied by the country’s informal induction furnace sector that impacted the global steel group’s calculation of its short-term outlook in April, worldsteel's Director General Edwin Basson explained.
“For 2018 and 2019 global steel demand remains healthy but faces increased challenges,” Saeed Al Remeithi, head of the organization’s economics committee and CEO of Emirates Steel, said at the summit. “Trade friction is making for an uncertain business environment,” he warned, adding that the slowdown in steel demand in China will affect global steel demand.
The latest forecast, though being more positive than that tabled in April, still points to a slower growth in most major markets in the year ahead. Worldsteel noted that nominal steel demand in China this year is expected to reach 6% at 781 million tonnes but that growth in real terms will only be 2.1%, with demand being flat in 2019.
World demand excluding China is seen rising 2.1% this year (lower than last year’s 2.4%) to 876.8 million tonnes, with 2019 growth seeing recovering to 2.7% to 900.2 million tonnes, according to the association.
In the European Union, demand growth this year will fall to 2.2% (from 3.4% last year) to 166.6 million tonnes, and shrink further to 1.7% in 2019 to 169.4 million tonnes.
The countries of NAFTA will see growth this year slide to 1.7% (from 6.3% last year) to reach 143.2 million tonnes, and dip to 1% next year to 144.7 million tonnes in 2019.
The expected slowdown in China notwithstanding, Asia remains the driver of world steel demand, with worldsteel forecasting that demand among the five ASEAN countries including Thailand and Indonesia to grow by 3.8% this year to 73.7 million tonnes and double again in 2019 to 6.2% in year-on-
year growth to 78.3 million tonnes. Demand among the five countries actually contracted by 4.3% in 2017, worldsteel notes.
India remains the outstanding performer globally where steel demand increase is seen staying at a robust 7.5% this year (up from 6% last year) to top 95.4 million tonnes and slip only marginally to 7.3% in 2019 to 102.3 million tonnes.
“Steel demand in India will be supported by improving investment and infrastructure programs,” the organization noted. “Stressed government finances and corporate debt weighs on the outlook (but) overall, we see very heathy growth in India.”
Written by Russ McCulloch, russ.mcculloch@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
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