Market Forecast: Global Demand expected to Rise, but U.S. market-size dips to no. 3

Source: worldsteel and AIST

2-minute read

According to the World Steel Association, the global steel demand is projected to expand to 1,735 Million metric tons in 2019, an increase of 1.3% over 2018. In 2020, demand is projected to continue to rise by 1.0 to reach 1.752 Billion tons. However, despite continuing demand, the rate of growth is diminishing.

According to Al Remeithi, chairman of the worldsteel Economics Committee, ““In 2019 and 2020, global steel demand is expected to continue to grow, but growth rates will moderate in tandem with a slowing global economy. Uncertainty over the trade environment and volatility in the financial markets have not yet subsided and could pose downside risks to this forecast.” Specifically, China’s deceleration, a slowing global economy, and uncertainty with trade and politics in multiple regions are drivers of the change in business investments and outlook.

In the U.S., steel demand in expected to growth, but at a diminishing rate. This comes as fiscal stimuli and monetary policies are normalizing and their effects becoming less noticeable. As a result, worldsteel is expecting growth in construction and manufacturing to moderate, as well as a slowing down of investment in oil and gas exploration.

At the same time, worldsteel is expecting the Indian market to accelerate. “While the fiscal deficit might weigh on public investment to an extent, the wide range of continuing infrastructure projects is likely to support growth in steel demand above 7% in both 2019 and 2020,” according to worldsteel. This expansion will essentially push the Indian Market ahead of the U.S., making it the second-largest market by demand with a projection of 102.8 Million metric tons this year.

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