Posted on 19 Apr 2021
For 2021, China’s apparent steel use is estimated to grow though at a slower pace of 3% on year to about 1 billion tonnes, after a robust 9.1% on-year gain in 2020, and the speed may drop further to 1% on year in 2022, while the other countries in the world will catch up in recovery in steel consumption over 2021-2022, according to the Short Range Outlook (SRO) released by the World Steel Association (WSA) on April 15.
However, Edwin Basson, director general of WSA, admitted the hardship projecting China’s steel consumption when asked about why WSA has updated China’s steel use to a 3% on-year growth from “flat on year” in its SRO release last October.
“This is interesting in that it seems that we have consistently been not very successful in forecasting China’s steel demand for the past few years, as we have kept receiving different messages from the members and the market,” he commented at the press conference on April 15 for the SRO release.
In comparison, the whole world’s steel demand is forecast at 1.87 billion tonnes in 2021, up 5.8% on year, having recovered from a 0.2% on-year decline in 2020, and it will grow but at a slower pace of 2.7% in 2022, both being higher than the increase for China, as steel operations in the rest of the world especially the developed economies will be gradually returning to the normal track in the second quarter on the assumption that the pandemic will stabilize, according to the release.
For 2020, the global steel demand just went down 0.9% on year in the end thanks to the 9.1% on-year growth in China that offset the 10.% on-year decline in the rest of the world, WSA commented.
For this year, the developed economies will see substantial recovery in their steel demand with their economic recovery, and their steel use will grow 8.2% on year for 2021 and then 4.2% on year for 2022, WSA projected, and for the EU 27 and UK, they are supposed to grow faster by 10.2% and 4.8% respectively for 2021 with the comprehensive recovery in all steel-using sectors.
However, the projection in the developed economies is based on the assumption that new waves of the pandemic will not jeopardize the pace of the economic recoveries in the developed economy after the struggling 2021 especially the free-fall in the second quarter of 2020, WSA pointed out.
“To some degree, the pandemic has been under control, and we are optimistic that economy in the EU countries will remain open even with lock-downs now and then,” Basson commented at the press conference.
He used auto industry as an example, as the industry has been a key steel consumer globally especially in the developed economies and it has heavily been relying on a global supply chain, and despite the shortages of auto chips and steel, auto manufacturing has been recovering strongly so far, and no serious impact has been detected in auto production.
The recovery in the auto industry “is expected to be particularly strong in the US, where the production level in 2021 will exceed the 2019 level. The global automotive industry is expected to return to the 2019 level in 2022,” WSA commented.
Table: World’s top 10 steel-using countries over 2020-2022
|
Finished steel demand (mln t) |
Y-o-Y (%) |
|||||
|
Country |
2020 |
2021 (f) |
2022 (f) |
2020 |
2021 (f) |
2022 (f) |
|
World |
1,771.8 |
1,874.0 |
1,924.6 |
-0.2 |
5.8 |
2.7 |
|
China |
995.0 |
1,024.9 |
1,035.1 |
9.1 |
3.0 |
1.0 |
|
India |
88.5 |
106.1 |
112.3 |
-13.7 |
19.8 |
5.9 |
|
U.S. |
80.0 |
86.5 |
90.2 |
-18.0 |
8.1 |
4.3 |
|
Japan |
52.6 |
56.0 |
58.8 |
-16.8 |
6.5 |
5.0 |
|
South Korea |
49.0 |
51.5 |
52.8 |
-8.0 |
5.2 |
2.5 |
|
Russia |
42.5 |
43.8 |
45.1 |
-2.3 |
3.0 |
3.0 |
|
Germany |
31.1 |
34.0 |
35.8 |
-11.6 |
9.3 |
5.3 |
|
Turkey |
29.5 |
35.0 |
37.0 |
13.0 |
18.7 |
5.7 |
|
Vietnam |
23.3 |
24.5 |
26.3 |
-4.2 |
5.0 |
7.6 |
|
Mexico |
21.7 |
23.4 |
24.6 |
-11.8 |
7.5 |
5.5 |
(f): forecast, source: WSA
Source:Mysteel Global
