On the second day of the 16th SteelOrbis Steel Conference “New Horizons in Steel Markets” held Thursday, December 2, online, Kazuo Mike Fujisawa, head of the overseas business planning department at Japan’s JFE Steel Corporation, opened his speech by saying that, after being negatively affected in 2020, all economies are recovering this year according to the IMF GDP figures. Regarding the steel demand outlook, Mr. Fujisawa said that in 2021 world steel demand will rise by 4.5 percent year on year to 1.85 billion mt, supported by pent-up demand and governments’ recovery programs, excluding China, which will see a one percent decline in steel demand.
Talking about China, the JFE Steel official said that its steel demand in 2021 will see negative growth because of the slowing momentum in its real estate sector and the government’s cap on production. For South Korea, steel demand is forecast to recover in 2021 to pre-Covid levels, with 9.1 percent anticipated growth to 53 million mt. Mr. Fujisawa added that the country’s exports are rising, while automotive production is decreasing amid the semi-conductor shortage which is also a challenge for the Japanese automotive industry. Japanese steel demand for 2021 is expected to increase by 10.2 percent to 58 million, though falling short of pre-Covid levels. On the other hand, he pointed out that steel exports from Japan will recover to pre-Covid levels in the first quarter of 2022.
“Success aside, as key words for our industry, I will choose China and carbon neutrality,” said Mr. Fujisawa, adding that, given the size of the Chinese market, any steps taken by China have the potential to cause far-reaching ramifications across the industry. He underlined that, when China exported more, prices were lower and now since it exports less because of the cap on production and the cancelling of the tax rebate for exports, prices are higher.
Commenting on carbon neutrality, Mr. Fujisawa said the steel industry is responsible for seven percent of carbon emissions in the world, although individual companies are announcing plans, sharing responsibility, some countries are fast in responding while others are still at the starting line.
Lastly, Fujisawa informed conference participants regarding the key figures from JFE Steel. During the financial year 2020-21, the company produced 22.8 million mt of crude steel, while its steel shipments amounted to 20.5 million mt, including 17.1 million mt of sheet, 1.6 million mt of bar and shapes, 1.1 million mt of slab and 700,000 mt of pipes. He added that JFE Steel is aiming to carbon-neutralize in 2050 through research and development for the early establishment of new technologies, as well as maximizing the utilization of electric arc furnaces and promoting maximum carbon recycling in blast furnaces to reduce emissions.