According to the Economic and Steel Market Outlook 2022-2023/Q1 2022 Report from the Economic Committee of the European Steel Association (EUROFER), in the third quarter of 2021, apparent steel consumption in the EU-27 amounted to 36 million mt, increasing by 14.3 percent compared to the same period of 2020 and easing compared to 40 million mt in the second quarter. The recovery is expected to continue in 2022 but at a moderate rate and will be subject to considerable uncertainty, including the ongoing energy crisis, until at least mid-2022.
“Ongoing supply chain disruptions, skyrocketing energy and carbon prices as well as persisting inflation are putting the recovery of the steel sector at risk. Combined with the current EU climate and energy policies, these are the ingredients of a dangerous cocktail that may drive Europe into a structural crisis and industry out of Europe”, Axel Eggert, EUROFER general manager, warned.
According to the association, EU steel consumption will grow by about 3.2 percent in 2022 and by 1.7 percent in 2023, after a rebound by 13.8 percent in 2021. Global supply chain issues and soaring energy prices are expected to seriously impact demand from steel-using sectors - automotive in particular - at least until the second quarter of 2022.
In line with steel demand, domestic deliveries in the EU continued their positive trend but at a slower pace, up by 6.6 percent in the third quarter, after an increase of 40 percent in the second quarter.
In addition, in the given quarter EU steel imports increased by 47.7 percent following a 45 percent rise in the previous quarter, as a result of the stronger improvement in demand.
The major pressures on the global supply chain experienced since July 2021, and especially those affecting the automotive sector, have impacted the output of steel-using sectors. In the third quarter of 2021, production in steel-using sectors grew by 3.2 percent, following a strong rebound of 29.2 percent in the second quarter. EUROFER stated that the current situation jeopardizes the recovery and casts substantial uncertainty on the overall outlook for steel-using industries, at least until the first half of 2022.