China's steel demand to fall 1% for '21, world up 4.5% - WSA

The World Steel Association (WSA) has revised its projection on apparent steel demand downward for both China and the whole world for 2021 to a 1% on-year drop and a 4.5% on-year gain respectively in its latest Short Range Outlook (SRO) released on October 14, against its forecast on April 15 when it anticipated a 3% on-year gain for China and a 5.8% on-year rise for the whole world.

"2021 has seen a stronger than expected recovery in steel demand, leading to upward revisions in our forecast across the board except for China. Due to this vigorous recovery, global steel demand outside China is expected to return earlier than expected to its pre-pandemic level this year," Al Remeithi, Chairman of the worldsteel Economics Committee, was quoted highlighting the variation in steel demand in the release.

In the latest SRO, WSA did adjust its projection on the growth in apparent steel demand for the countries ex-China upward to 11.5% on year for the whole 2021 from 9.3% back in April, reaching 870 million tonnes among the world's total at 1.86 billion tonnes.

Among all the countries, developed economies are expected to see their apparent steel demand up the most by 12.2% on year for the whole 2021 as against WSA's projection in April at 8.2% to 385 million tonnes, as they "have outperformed ... earlier expectations by a larger margin than the developing economies, reflecting the positive benefit of higher vaccination rates and government support measures", according to the release.
Source: World Steel Association

As for 2022, WSA expects no growth in China's steel demand, due to "the real estate sector remaining depressed in line with the government policy stance on rebalancing and environmental protection," and that "recent government action to push for a transition away from the real estate-dependent growth model is likely to continue", even though "some restocking activities might support apparent steel use", according to the latest SRO.

For 2022, apparent steel demand for the whole world, in comparison, will continue to grow though at a lower pace of 2.2% on year to approximately 1.9 billion tonnes, and the growth in developed economies will also drop substantially to 4.3% on year to 401.7 million tonnes.

However, "persistent rising inflation, continued slow vaccination progress in developing countries and further growth deceleration in China all pose risks to this forecast," WSA warned in the release.

Written by Hongmei Li, li.hongmei@mysteel.com

This article has been published under an article exchange agreement between Mysteel Global and SteelMint.