Global steel demand is expected to decrease by 6.4% year-on-year in 2020

August 28 22:10 2020

The World Steel Association today released short-term steel demand forecasts for 2020 and 2021. According to the forecast, the global steel demand will shrink 6.4% to 1.654 billion tons by 2020, affected by the 2019 new coronavirus pneumonia epidemic. Global steel demand is expected to return to 1.717 billion tons in 2021, up 3.8 per cent from 2020. China’s recovery is expected to be ahead of the rest of the world, easing the decline in global steel demand this year. It is inferred that most countries’ closure measures will continue to ease during June and July, social restrictions will continue to be implemented, and most steel-producing countries will not be affected by the second wave of.

We expect China’s steel demand to grow by 1.0% in 2020. We also expect that the benefits of the “new infrastructure” project launched in 2020 will continue until 2021, supporting demand for steel in 2021. The central government is not expected to re-launch a massive stimulus package, as it did in 2009, which could undermine the government’s desire to continue rebalancing. However, if the global economic environment has a more profound impact on China’s economic recovery, the government may need to boost the economy further, which means there is a possibility that steel demand will rise

Steel demand in developed economies is expected to decline by 17.1 per cent in 2020. While the consumer and service sectors are the main force in the current recession, the downturn in consumer spending, the deterioration of the labour market and the collapse of confidence are driving the general decline in the steel sector. Spillover effects from massive unemployment and bankruptcy, weak confidence performance and continued social distance measures suggest that steel demand in developed economies recovered only partially by 7.8 per cent in 2021

In the United States, the epidemic is leading to a sharp decline in manufacturing and is expected to reach its lowest point in the second quarter. Falling oil prices put additional downward pressure on investment in energy-related industries, which had been in trouble before the crisis. Rising unemployment has led to lower incomes and confidence, affecting housing construction. Although the situation of non-residential buildings is relatively good, it is expected to decline in 2020 and pick up slightly in 2021

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