Steel Demand in Developed Economies to Decline by 15%

SEATTLE (Scrap Monster): The update to Short Range Outlook (SRO) for 2020 and 2021 published by the World Steel Association (worldsteel) foresees 14.9% decline in overall steel demand in the developed economies in 2021. Meantime, the trade body predicts the demand to increase by 7.9% in 2021.

According to worldsteel, the Covid-19 pandemic is likely to have a less severe impact on steel demand in the developed economies, than the global financial crisis. The manufacturing activity in the region, which was just beginning to recover from the late-2019 slowdown, was impacted by the pandemic. It witnessed a strong bounce back after the economies reopened.

The boosted government support measures have led to strong recovery from the lockdown in the U.S. The downturn in manufacturing sector was shorter and less acute than expected. However, worldsteel shared a less optimistic outlook for 2021, especially on account of anticipated subdued activity in construction and automotive sectors.

The fiscal stimulus measures by European governments have acted as a shield to the region’s steel industry. Although post lockdown recovery seems to be strong in the region, the momentum is expected to drop in the coming months, mainly driven by contraction in Italy and Spain.

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