Major Emerging Economies to See Double-Digit Drop in Steel Demand

SEATTLE (Scrap Monster): The Short Range Outlook (SRO) report published by the World Steel Association (worldsteel) predicts that steel demand in major emerging economies is expected to witness double-digit decline in 2020, falling by 12.3%.

The emerging economies have been less prepared and equipped to deal with the impacts of Covid-19 pandemic. These countries had to resort to severe containment measures, which consequently resulted in huge drop in domestic demand for consumer goods including steel. The export trade too was impacted badly. The worldsteel foresees no immediate recovery, especially due to fears of a second wave of the pandemic.

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The countries which were worst affected include Brazil and India. In fact, India, which implemented most severe and prolonged lockdown, is likely staring at the deepest decline in steel demand in decades. A relatively fast recovery is expected in 2021, mainly triggered by government stimulus measures.

The impact was high across counties in the Latin American region. The region is likely to witness slow recovery in 2021 as well. In ASEAN region, Malaysia and the Philippines were the severely affected countries. On the other hand, Vietnam is likely to see positive steel demand growth, due to successful containment of the pandemic. The MENA region was also hit severely.

The steel demand is expected to recover by 10.6% in 2021.