Global steel demand will grow by 7% to a little more than 1.622 billion mt this year and reach around 1.648 billion mt in 2018, the World Steel Association said Monday during its annual general meeting in Brussels.
It noted that China closed most of its outdated induction furnaces this year, a category that had not generally not been included in official statistics.
But with the closures, demand from this sector of the market is now being met by mainstream steelmakers and therefore captured in the 2017 official statistics.
As a result, the nominal growth rate for steel demand in China increased to 12.4%, or 765.7 million mt.
But stripping out the statistical anomaly, the underlying growth rate of China steel demand would be 3% this year which would bring the corresponding global growth rate to 2.8% this year. In 2018, China's demand will be flat at 765.7 million mt, worldsteel said.
The overall global demand growth projections follow a 1% year-on-year increase in 2016, when demand was nearly 1.516 billion mt, and a 3% decline in 2015, when global demand totaled more than 1.498 billion mt.
Worldsteel economics committee chairman TV Narendran told reporters at the meeting the expected growth in global steel demand was "encouraging," as a cyclical upturn broadened and firmed throughout the year.
This led to better-than-expected performance for both developed and developing economies, although the Middle East/North Africa region and Turkey were exceptions.
"Certainly, the industry is looking at slightly better times than we've seen in the last few years," said Narendran, who is also managing director of Tata Steel Ltd.
Regionally, worldsteel expects the European Union group of 28 countries to have demand growth of 2.5% this year to 162.1 million mt, and 1.4% growth next year to 164.3 million mt.
NAFTA's US, Mexico and Canada will grow by a combined 4.9% in 2017 to 138.7 million mt and 1.2% in 2018 to 140.4 million mt.
The CIS and Central and South America regions are expected to have big turnarounds this year.
Central and South America demand contracted 13.5% last year, but will grow by 2.5% this year to 40.4 million mt, and 4.7% next year to 42.3 million mt, according to worldsteel.
CIS demand fell 2.7% in 2016, but will grow by 3.6% in 2017 to 51.1 million mt, and 3.8% to 53 million in 2018, worldsteel said.
