Speaking at the SteelOrbis 2019 Fall Conference & 81st IREPAS Meeting held in Düsseldorf on September 22-24, Adam Szewczyk, head of data management at the World Steel Association (worldsteel) shared the 2019 and 2020 steel demand forecasts with the participants at the event. He said that worldsteel expects global steel demand of 1.73 billion mt for 2019, with year-on-year growth of 1.3 percent, while global steel demand in 2020 is forecast to reach 1.75 billion mt, up one percent year on year. Mr. Szewczyk noted that, as steel demand is at another inflection point, in the longer term growth in steel demand will be very slow.
According to worldsteel, in 2019 Chinese steel demand growth is expected to decelerate to one percent, while in 2020 steel demand in China is anticipated to decrease by one percent, year on year. On the other hand, central and South America will see growth in steel demand in 2020, along with the Middle East, after registering declines in 2018 and an expected decline in 2019. The worldsteel official said that, despite some stabilization, a quick rebound is less likely in Turkey and, after seeing a deep contraction in 2019, recovery of steel demand in Turkey will be limited in 2020.
Looking at current market conditions, the ASEAN region stands out as a bright spot, benefitting from trade diversion. Commenting on North Africa, Mr. Szewczyk indicated that the region has seen rapid growth in steel demand, adding though that steel demand will contract in 2019 due to the completion of construction projects.
Mr. Szewczyk said that the cyclical downturn in the global economy is exacerbated by uncertainties which are hurting investments. The uncertainties include trade tension between the US and China, Brexit talk, geopolitical conflicts in the Middle East and the weakening of established global institutions.
The worldsteel official underlined that the current global steel capacity is enough to meet demand until 2035, while stressing that it may be better to know that the market is satisfied at the moment while making investment decisions. Worldsteel expects steel demand of less than 2 billion mt for 2035.