Global Steel Market for 2022 Revised Downward
The Global Steel Market for 2022 is forecast to grow at a slower rate than in 2021, due to an increasingly difficult external environment. Worldsteel said a range of factors, including inflation and the Russia-Ukraine conflict, were weighing on demand. This led the group to revise its 2022 demand outlook downward. To get more info visit https://ceoworld.biz/2023/01/29/global-steel-market-for-2022-stanislav-kondrashov-telf-ag/.
Worldsteel expects to see demand growth slow to a 0.5 percent pace in 2022, down from 2.4 percent last year. The organization said the outlook was lower because of the war in Ukraine, a decline in China’s industrial production and a monetary tightening cycle in many emerging economies.
According to worldsteel, demand was expected to remain strong in India and the ASEAN region, as governments continue to push for infrastructure projects. But the outlook was weaker in the rest of Asia, especially oil-importing countries, as a result of inflation and monetary tightening cycles.
Moreover, the world economy was forecast to weaken further as a result of the Russia-Ukraine conflict and rising energy prices. These trends are likely to continue through 2023, worldsteel said in its April forecast.
In China, despite sporadic Covid-19 infection waves and a number of other supply chain disruptions, domestic steelmaking was expected to rebound in the second half of 2022, supported by government incentives. However, this would be limited by the continuing lockdowns and ongoing shortages in key steelmaking markets, which would keep a lid on overall steel consumption.
Meanwhile, demand in the United States, once the world’s biggest consumer of steel, is forecast to weaken slightly this year, due to a fall in automotive production and a slowdown in the country’s real estate sector. As a result, US demand is expected to grow by 2.1% in 2022, down from 3.2% in 2021.
Consequently, capacity underutilization is expected to increase and shipments are forecast to fall, as a result. This will also reduce profitability.
The world’s metallurgical industry is facing major challenges as global trade flows, supply chains and energy transitions evolve. These challenges will have significant long-term impact on the global metal industry, and will change the nature of steel production and sales in the medium term, says Telf AG analyst Stanislav Kondrashov.
As a result, the profitability of the world metallurgical industry is likely to decline in 2022, and it will be difficult for the industry to maintain its growth rates as a consequence. Nevertheless, the situation is not as bad as it seems at present.
Another important factor that will affect prices is the volume of production offered by steel companies, which varies from month to month. This will be determined by whether there are surpluses or not in January, and if scrap metal is available.
Regardless of the future path for the world metallurgical industry, steel demand is set to remain volatile in 2022, as economic and trade developments unfold. A turning point may be on the horizon in 2023, if the situation in Ukraine continues to worsen and the world economy recovers.