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Informist, Tuesday, Oct. 15, 2024

 

MUMBAI – Global steel demand is expected to fall by 0.9% to 1.75 billion tonnes in 2024, marking the third consecutive year of declining demand, the World Steel Association said in a release.

 

The drop can be attributed to a struggling global manufacturing sector, declining household purchasing power, aggressive monetary tightening, and escalating geopolitical uncertainties, Martin Theuringer, managing director, German Steel Association and chair of the worldsteel Economics Committee, said. 

 

However, the association sees steel demand rising in developing nations in 2024, while the demand in developed countries is expected to fall in 2024. Steel demand in the developing world, excluding China, is expected to rise 3.5% in 2024 and 4.2% in 2025, driven by robust growth in India and a rebound in other major economies, according to the report. Meanwhile, steel demand in developed countries is expected to fall 2% in 2024, as major steel-using economies like the US, Japan, Korea, and Germany face significant declines.

 

The association expects a significant decline in demand for steel in China and most major developed economies this year. The ongoing downturn in the Chinese real estate sector is expected to dominate steel demand in China, resulting in a 3?cline in 2024 and a further 1?cline in 2025. However, it said: "We acknowledge an upside risk to our 2025 forecast. There is a growing possibility of more substantial government intervention and support for the real economy, which could bolster Chinese steel demand in 2025," the report said.

 

India is expected to maintain its strong momentum with significant growth in steel demand in both 2024 and 2025. The association expects steel demand in India to rise 8% over 2024 and 2025.

 

After a negative forecast for this year, the global body, however, expects the world steel demand to grow by 1.2% to 1.77 billion tonnes in 2025. The key determinants of the global steel demand outlook for 2025-2026 will be the progress made in the stabilisation of China's real estate sector, the effectiveness of interest rate adjustments in spurring private consumption and business investment, and the trajectory of infrastructure spending dedicated to decarbonisation and digital transformation across major global economies, Theuringer said.

 

The global body sees steel demand to increase in a decade on the back of the green transition of the world economy. This is one of the major factors behind the strength in public infrastructure investments, as it necessitates an economic transformation of immense scale and complexity, it said. 

 

Steel demand for expanding global electricity grids is likely to double by the end of the decade, reaching around 20 million tonnes per year, a substantial increase from the current pace of 10 million tonnes per year, according to the report. The steel body sees the expanding global renewable energy generation capacity will necessitate a rise of around 40 million tonnes in steel demand by the end of the decade.  End

 

Reported by Ashutosh Pati

Edited by Deepshikha Bhardwaj

 

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