OECD: Global steel demand growth to remain sluggish in 2024, 2025
Global steelmaking capacity exceeded steel production by 552 million tonnes in 2023, which was more than the combined steel production of India, the Americas, EU, Japan, and Turkiye in the same period, the Committee pointed out.
Excess capacity is expected to increase significantly over the next three years. Around 158 million tonnes of new capacity is potentially coming on stream until 2026, among which around 60% will take place in Southeast Asia, India and the Middle East, it predicted.
On the other hand, the sluggish demand for steel has begun to take shape worldwide since a few years ago. In 2022, global demand for steel fell by 3.3% in 2022 and recovered by only half this amount in 2023, mainly attributed to higher interest rates which continue to depress construction activity, the largest steel consuming sector, and investment. Currently, steel demand is growing by only around 36 million tonnes per year.
Additionally, the OECD Steel Committee has raised concerns on risks of escalated trade tensions in steel at the meeting, as global steel exports increased significantly by 282 million tonnes last year, which was primarily driven by Chinese figures.
Meanwhile, other smaller economies, particularly in Southeast Asia, have ramped up steel exports with rapid capacity growth that's outstripping their own domestic demand.
The Committee also agreed that if excess capacity and its root causes are addressed, the transition to a competitive low-carbon steel production can be accelerated. Steel produced from electric-arc-furnace scrap is projected to reach 50% of world steel production by 2050, a new study by the Committee shows.
Written by Adele Pan, panqinjie@mysteel.com
Edited by Alyssa Ren, rentingting@mysteel.com
Japan's October crude steel result offers sliver of hope
Nov 27, 2023 12:00
METI: Japan's April-June crude steel output to fall 5% YoY
Apr 13, 2023 09:00
Tata reports stable production in Q1FY'23; demand to recover in Q2
Jul 28, 2022 08:30
WSA: Global Q1 crude steel output edges up 0.5% YoY
Apr 24, 2024 11:15
India's crude steel production up 13% in FY'24
Apr 18, 2024 10:00