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Worldsteel revises 2019 steel demand outlook up on China

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Worldsteel revises 2019 steel demand outlook up on China

Monterrey, Mexico — Worldsteel revised its 2019 short-range outlook (SRO) for steel demand higher Monday on the back of resilient demand mostly out of China.

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Worldsteel provided an updated SRO at its General Assembly in Monterrey, Mexico, and forecast global steel demand to grow by 3.9% to 1.775 billion mt, compared to an earlier forecast of 1.3% or 1.735 billion mt in April.

Global steel demand is expected to grow by another 1.7% in 2020 to 1.805 billion mt as emerging and developing economies, excluding China increase contributions. China will be the main driver of growth, with the country forecast to see its steel requirements increase by 7.8% to 900.1 million mt in 2019. The rest of the world is expected to record 0.2% growth to 874.9 million mt.

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"The current SRO suggests that global steel demand will continue to grow in 2019, more than we expected in these challenging times, mainly due to China," said Al Remeithi, chairman of the worldsteel economics committee.

The rest of the world was hampered by "uncertainty, trade tensions and geopolitical issues" which "weighed on investment and trade," added Remeithi. "Manufacturing, particularly the auto industry, has performed poorly contracting in many countries, however in construction, despite some slowing a positive momentum has been maintained."

Steel demand is expected to fall in five of eight regions in 2019. The sharpest year-on-year decline is forecast to be Europe outside the European Union, including Turkey, where demand is expected to decline by 12.1% to 32.9 million mt in 2019. Steel demand in the EU is slated to decline by 1.2% to 166.8 million mt in 2019.

The NAFTA region is expected to be mostly flat in 2019 with 0.6% demand growth in 2019 to 141.5 million mt.

All major regions were forecast to show flat-to-positive steel demand growth in 2020 but face "significant downside risks if the current level of uncertainty prevails," said Remeithi in the report.

--Michael Fitzgerald,

--Edited by Jonathan Loades-Carter,