Posted on 22 Jun 2021
The ASEAN-6 countries, the world’s new emerging steel hub, are expected to see combined growth in steel consumption of 6.1% on-year this year to reach 74.9 million tonnes, though many among the six are still battling their third or fourth waves of the coronavirus, according to Yeoh Wee Jin, secretary general of South East Asia Iron and Steel Institute (SEAISI) on June 17.
Yeoh shared the Institute’s forecasts Thursday at the SEAISI 50th Anniversary e-Conference & Exhibition over June 17-22.
The forecast 6% on-year increase will follow last year’s sharp fall estimated at 12.1% as the pandemic continued to impact regional economies, according to Yeoh.
In ASEAN, post-pandemic recovery is underway, but “the industry (demand) is still not reaching pre-pandemic levels,” Yeoh acknowledged during his e-presentation. “We are hoping that we are able to achieve it sometime in 2022,” he told attendees.
The rate of recovery will depend on these countries boosting their economic activity, the roll-out of vaccinations, and taking control of the pandemic, Yeoh stressed.
Steel consumption forecast for ASEAN-6
|
Country |
2020 E (mln t) |
2021 E (mln t) |
YoY (%) |
|
Vietnam |
23.3 |
24.7 |
5.8 |
|
Thailand |
16.3 |
17.1 |
4.5 |
|
Singapore |
1.6 |
2 |
25 |
|
Philippines |
8.5 |
9 |
6 |
|
Malaysia |
5.7 |
6.1 |
7.5 |
|
Indonesia |
15.1 |
16 |
6 |
|
ASEAN-6 total |
70.6 |
74.9 |
6.1 |
Source: SEAISI
E= estimate
For the major steel-consuming sectors in the region this year, construction among ASEAN countries is expected to see on-year growth in building investment of 1.9%-26.9%, according to forecasts from multiple global sources compiled by SEAISI. The growth will mainly be driven by public construction, Yeoh noted.
But challenges for the construction sector remain, including renewed lockdowns in some of the countries, social distancing, restrictions on mass gatherings, and reductions in numbers of migrant construction workers, he stated.
Also struggling this year will be the automotive sectors in major auto-consuming countries such as Indonesia and Thailand, where on-year declines in sales of 22.3% and 5.3% respectively are predicted. The two countries’ auto sales reached 1 million units and 792,000 units in 2020, the SEAISI data show.
Fortunately for steelmakers though, Philippines and Malaysia may witness on-year increases in auto sales of 21.5% and 5.4% this year, though the two countries’ sales volumes are much smaller. The global shortage of integrated circuits for automobile use is also hitting ASEAN’s auto industry, according to Yeoh.
But overshadowing all is the fact that some among the ASEAN-6 countries are still battling COVID-19, Yeoh observed. On June 8, for example, Indonesia, Malaysia and Philippines each recorded over 4,000 new cases of infections, he noted, adding that the pandemic itself and ongoing lockdown measures will affect the pace of recovery of steel demand this year.
SEAISI did not share a forecast of steel output among member countries for this year, but Yeoh noted that many steel producers are already expanding steel capacity or plan to in the next few years.
Source:Mysteel Global
