In 2018, high investment levels and a rebound in commodity prices are creating good conditions for global steel demand in both developed and developing countries. A slight slowdown in demand in 2019 will be associated with further weakening of investment dynamics in China due to higher interest rates. Steel demand in developed countries is forecast to grow by 1.8% in 2018 and decline to 1.1% in 2019.
In emerging economies (excluding China), steel demand is expected to increase by 4.9% and 4.5% in 2018 and 2019, respectively. In Russia and Brazil, there will be a slight recovery in the steel market. In Russia, demand for rolled metal products will be supported by credit expansion, monetary policy easing and improved consumer and business confidence.
In early 2017, Brazil began to emerge from its deep recession, but uncertainty remains about the sustainability of this recovery. The rise in construction work is slow. Elsewhere in Latin America, recovery is also continuing, and growth in the region could pick up if reforms are implemented, but the upcoming elections will create uncertainty.
Demand for Turkish steel showed strength in 2017, supported by government measures. It is expected that demand for steel in Turkey, although it will slow down due to the weakening of economic stimulus, will show stable growth in 2018-2019.
The Indian economy is stabilizing under the influence of currency reform and income tax (goods and services tax), and demand for steel is expected to gradually accelerate, mainly driven by public investment. Stronger growth is hampered by still weak private investment.
Steel demand in ASEAN-5 countries fell in 2017 due to slow construction activity. However, in 2018/19, steel demand is expected to recover growth, supported by infrastructure investment
The outlook for growth and risk mitigation for this outlook is largely balanced, as stated by Worldsteel.
