Global steel demand is expected to grow 3.9% on year in 2018 and an additional 1.4% in 2019, the World Steel Association said Tuesday.
It is expected to reach 1.66 billion mt in 2018 and 1.68 billion mt in 2019, according to worldsteel's October 2018 short range outlook released Tuesday at the organization's annual meeting in Tokyo.
The group attributed the growth to the recovery in investment activities in developed economies and the improved performance of emerging economies.
In its outlook, worldsteel noted that while strength in the market carried over to 2018, risks have increased as rising trade tensions and volatile currency movements continue to cause uncertainty. Normalization of monetary policies in the US and EU could also influence the currencies of emerging economies, according to worldsteel.
Steel demand in developed economies is expected to increase by 1% in 2018 and 1.2% in 2019 and in emerging economies, excluding China, to increase by 3.2% and 3.9% in 2018 and 2019, respectively.
For end-use markets, the outlook for steel demand in the construction and automotive sectors is mixed in many countries, worldsteel said.
In developed economies, worldsteel expects growth in the construction sector to moderate after the strong recovery momentum seen in 2017 to 2018 due to a high base and rising interest rates. Construction activities in most developing economies will continue to grow, notably in India, ASEAN and MENA, worldsteel said. However, construction activity in Brazil has not yet started to recover from its crisis, it added.
Automotive markets, which showed strong growth in developed economies, are softening on the back of slowing demand growth, rising fuel prices and interest rates, worldsteel said.
In developing countries, worldsteel expects demand for automobiles to continue to grow at a healthy pace, while the machinery sector in both the EU and US continues to be supported by a strong investment phase.
