According to a report released by the World Steel Association (worldsteel) on October 12, apparent steel use is forecasted to contract worldwide by 8.6 percent year on year to 1.1 billion metric tons in 2009, after declining by 1.4 percent in 2008.
According to the report, this is an improved figure over the spring forecast issued last April which predicted a decrease of 14.1 percent. The improvement is largely due to the exceptionally strong growth in steel demand in China. With signs of a worldwide recovery apparent from the beginning of the second half of 2009, global steel demand in 2010 is forecast to grow by 9.2 percent to 1.21 billion metric tons, which represents a recovery to the level of 2008.
Commenting on the forecasts, Daniel Novegil, chairman of worldsteel's economics committee said, "The global recovery is stronger than we predicted in April. According to our current forecast, China will rebound 19 percent in 2009 and five percent in 2010. Emerging economies will slow down 17 percent in 2009, to grow 12 percent in 2010. Apparent steel use in developed economies, that contracted 34 percent in 2009, will rebound 15 percent in 2010. Therefore, worldsteel forecasts that global steel demand will return to growth in 2010 but this is expected to be moderate. As before the financial crisis, the emerging economies, especially China, will be the critical factor in driving world steel demand in the near future."
Concluding, Mr. Novegil declared; "While the state of the global economy has improved, uncertainties and concerns regarding the resilience of the recovery still remain with the possibility of any premature reduction in government stimulus actions. This uncertainty particularly exists for the Chinese economy in 2010, whose fast recovery in 2009 was largely enabled by such strong government stimulus policies."
China's apparent steel use in 2009 is expected to increase by 18.8 percent to reach 526 million mt. China is expected to account for 47.7 percent of world steel apparent use and, excluding China, potential world steel demand would have fallen by 24.4 percent.
India also remained relatively resilient during the global crisis, and its apparent steel use is expected to grow by 8.9 percent and 12.1 percent in 2009 and 2010, respectively.
The NAFTA region is expected to show a 35.8 percent decline in apparent steel use in 2009 and then a positive 17.1 percent growth in 2010. Apparent steel demand in the US is likely to fall by 38.7 percent to 60 million mt in 2009, after falling by 8.2 percent in 2008. It should recover to 72 million mt in 2010 with a growth rate of 18.8 percent.
The EU-27 economies were also severely affected by the crisis and the region's apparent steel use is expected to fall by 32.6 percent in 2009 to 122 million mt. In 2010, apparent steel use in the EU-27 is expected to grow by 12.4 percent.
Turkey is expected to see its apparent steel use decline by 11.6 percent in 2009, but is predicted to recover by 15.1 percent in 2010 to reach 18.18 million mt.
For both NAFTA and the EU-27, the level of apparent steel use that is expected in 2010 amounts to what was achieved back in 1991, demonstrating the severity of the impact of the crisis on the steel industry.
Japan will see its apparent steel use decline by 31.3 percent in 2009, but is expected to recover by 15.8 percent in 2010 to reach 61 million mt.
Apparent steel use in the CIS region is expected to contract by 30.8 percent in 2009 and should grow by only 8.2 percent in 2010.
The projections made by worldsteel consider both real and apparent steel use. Apparent steel use reflects the deliveries of steel to the marketplace from the domestic steel producers as well as from importers. This differs from real steel use, which takes into account steel delivered to or drawn from inventories.