It is expected that the trough in the steel consumption cycle in the European Union will be reached during the first half of 2010, according to the Economic and Steel Market Outlook 2010-2011/Q2 2010 Report from EUROFER's Economic Committee, released by the European Confederation of Iron and Steel Industries (EUROFER).
According to EUROFER, following a weak first quarter - with economic activity and consequently steel consumption negatively influenced by the severe winter conditions in the EU - real consumption will show still hesitant but positive year-on-year growth from the second quarter onwards. Towards the end of this year, the growth rate could become slightly firmer.
On balance, real steel consumption in 2010 will stabilize at around the year-earlier level.
On a par with the expected rise in production in the steel using industries, real steel consumption will show a more robust rebound in 2011. Also, the anticipated increase in steel intensity following its decline during the economic downturn will be supportive of growth in steel consumption.
EUROFER stated that real steel consumption could rise by five percent next year. However, even if real consumption continued to grow at this rate, it would take several years before steel consumption comes back to the levels seen before the crisis.
According to the data released by EUROFER, in the fourth quarter of 2009, the reduction in real steel consumption was down to almost 14 percent year on year compared with a fall of on average 26 percent year on year in the first three quarters of the year. In the whole of 2009, real steel consumption fell by 23.4 percent year on year.