US steel industry expected to return to growth in 2017

Wednesday, 28 December 2016 23:24:33 (GMT+3)   -   San Diego
SteelOrbis News

Crude steel output in the US is predicted to increase by 4.4 percent in 2017, reversing almost two years of contraction, according to an average of forecasts from a Financial Times survey of 20 analysts. 

US steelmakers were hurt by the collapse in prices triggered by global oversupply, depressed raw material prices and cheap imports over the last several years. However, steel prices domestically have risen throughout most of 2016, largely due to protectionist measures.  The US steel industry is expected to return to growth next year with production predicted to rise on lower imports and strong demand from the construction and energy sectors, despite a slight forecasted weakness in the automotive sector. President-elect Donald Trump has pledged to invest over $1 trillion in infrastructure, though analysts say new expenditure will probably take 18 months to take effect.

A key influencer in the US growth expectation is the anticipated behaviour of China, the biggest producer of steel, which accounted for nearly half the 1.6bn mt world crude steel output. Beijing has promised to close unneeded factories. While some industry figures have questioned the pace and scale of the reforms, survey respondents predict an output shrinkage of 0.3 per cent.

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