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worldsteel Short Range Outlook 2014-2015

In 2015, it is forecast that world steel demand will grow further by 3,3 % and will reach 1576 Mt. After growth of 6,1 % in 2013 with support from government infrastructure investment, apparent steel use in China is expected to slow to 3 % growth in 2014 to 721,2 Mt as the Chinese government’s efforts to rebalance the economy continues to restrain investment activities. In 2015, steel demand growth is expected to further decelerate to 2,7 %. In India, steel demand is expected to grow by 3,3 % to 76,2 Mt in 2014, following 1,8 % growth in 2013, due to an improved outlook for the construction and manufacturing sectors, even though this will be constrained by high inflation and structural problems. Despite uncertainties relating to the impact of upcoming elections steel demand is projected to grow by 4,5 % in 2015 supported by the expectation that structural reforms will be implemented. Following a 2 % increase in 2013, because of the moderate GDP recovery as a result of “Abenomics”, apparent steel use in Japan is expected to contract by –1 % to 64,6 Mt in 2014 due to the consumption tax hike affecting the construction and automotive sectors negatively. In 2015, steel demand is expected to increase by 0,5 %. In USA, after a decrease of –0,6 % in apparent steel use in 2013, years 2014–2015 are expected to deliver a return to growth and recovery. Apparent steel use will grow by 4 % to 99,4 Mt in 2014 and by 3,7 % in 2015. The impact of the Federal Reserve Bank tapering programme on the US economy has been contained so far, but future actions still remain a risk. Apparent steel use in Mexico is expected to grow by 3,4 % to 19,2 Mt in 2014 and to grow further by 3,9 % in 2015. In Central and South America, apparent steel use is projected to grow by 3,4 % to 50,9 Mt in 2014 down from 4,3 % in 2013. This is forecast to slow further to 2,7 % in 2015 due to contraction in Argentina and a sharp slowdown in Chile. In Brazil, steel demand growth will slow to 3 % to 27,2 Mt in 2014 and 3,2 % in 2015 as high inflation and interest rates continues to restrain economic growth. After a contraction of –0,2 % in 2013, apparent steel use in the EU (28) is expected to grow by 3,1 % in 2014 to 143,3 Mt with help of the construction sector which is gradually bottoming out. Underlying trends at national level will continue to differ, but it appears that Southern Europe has passed its lowest point. Apparent steel use in Germany is expected to increase by 4,5 % in 2014, Italy by 2,6 %, France by 1 % and Spain by 3 %. A steady transition to a broader and more durable recovery will result in steel demand growth of 3 % in the EU (28) in 2015. Apparent steel use in the CIS region is projected to grow by only 1,1 % reaching 59,5 Mt in 2014 due to slow investment, but will grow by 3,7 % in 2015 with Russian steel demand accelerating to 4,4 % growth. Steel demand in Ukraine will continue to contract in 2014 but the fall will be limited to –3 % to 54 Mt due to financial assistance from the International Monetary Fund. In the MENA region, steel demand is expected to grow by 6,1 % to 66,7 Mt in 2014 after a 0,9 % increase in 2013. Growth in the region is strengthening as political uncertainties moderate. Strength in the non-oil sector in the GCC (Gulf Cooperation Council) countries is expected to stretch into 2014 and the Egyptian economy as well as the rest of the region will continue to recover. In 2015, steel demand in the region is expected to grow by 9,4 %. Overall apparent steel use growth in the developed economies will be above 2 % in 2014 and 2015, however the developing and emerging economies will continue to grow faster than the developed economies despite their more subdued performances.

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