Steel Demand to Witness Steady Growth, says worldsteel SRO

SEATTLE (Scrap Monster): The World Steel Association (worldsteel) has released its October 2017 Short Range Outlook (SRO) Report. The SRO predicts continued growth for global steel demand in 2017 and 2018. The demand is expected to rise to 1,622.1 million tonnes (Mt) in 2017 and jump further to total 1,648.1 Mt in 2018. The global steel demand excluding China will witness a growth of 2.6% in 2017. The demand is expected to further rise by 3.0% in 2018.

Among the various regions, Asia and Oceania will report largest jump in steel demand. The demand by the region is expected to surge higher by 9.3% in 2017 and by a further 1.1% in 2018. The NAFTA region will report demand growth of 4.9% and 1.2% in 2017 and 2018 respectively. The report predicts stable demand growth of 3.6% and 3.8% respectively by the CIS region during these two years. The Middle East will see a demand growth of 1.5% and 4.8%. The steel demand in the EU-28 region is expected to jump by 2.5% and 1.4% in the current year and next year respectively. worldsteel predicts demand growth of 1.6% and 3.3% by the African region. Meantime, steel demand in Central and South America is expected to grow by 2.5% in 2017 and by 4.7% in 2018.

The developing countries are likely to benefit from a strengthening global economy. The key reforms in Egypt, Brazil, Argentina, Mexico and India will enhance their growth potential. ASEAN region, especially Vietnam and the Philippines will post highest growth, whereas growth is expected to slow down in Thailand and Malaysia. The low oil prices may continue to cap demand growth in the MENA region. Overall, the steel demand in developing economies excluding China will grow by 2.8% in 2017 and 4.9% in 2018. Meanwhile, Chinese steel demand is expected to grow by 3% in 2017. However, the country is likely to report no growth in 2018.

The world steel demand will see good recovery, driven largely by cyclical factors. The key threats mentioned in the April 2017 SRO including rising protectionism, US policy shift, EU uncertainties and Chinese deceleration still exists, but have abated to a certain extent. The risks seem to be more balanced now. The escalating geopolitical crisis in Korea continues to pose threats, worldsteel noted. The global trade has gained momentum during recent times. The global growth is expected to remain modest in 2018, it added. The steel demand in developed economies is expected to see growth of 2.3% in 2017 and 0.9% in 2018.