worldsteel Short Range Outlook April 2023

The World Steel Association (worldsteel) has released its Short Range Outlook (SRO) steel demand forecast for 2023 and 2024. worldsteel forecasts that this year, demand will see a 2.3% rebound to reach 1,822.3 Mt. Steel demand is forecast to grow by 1.7% in 2024 to reach 1,854.0 Mt. Manufacturing is expected to lead the recovery, but high interest rates will continue to weigh on steel demand. Next year, growth is expected to accelerate in most regions, but deceleration is expected in China.

Commenting on the outlook, Mr. Máximo Vedoya, CEO of Ternium, and Chair of the worldsteel Economics Committee, said, “in 2022, recovery momentum after the pandemic shock was hampered by high inflation and increasing interest rates, the Russian invasion of Ukraine, and the lockdowns in China. As a result, steel-using sectors’ activity went down in the last quarter of 2022. This, combined with the effect of stock adjustments, led to worse than expected contraction in steel demand.

Persistent inflation and high-interest rates in most economies will limit the recovery of steel demand in 2023, despite positive factors like China’s reopening, Europe’s resilience in the face of the energy crisis, and the easing of supply chain bottlenecks. In 2024, demand growth is driven by regions outside China but faces global deceleration due to China’s anticipated 0% growth, overshadowing the improved environment. Sustained inflation remains a downside risk, potentially keeping interest rates high.

As China’s population declines and moves to consumption-driven growth, its contribution to global steel demand growth will lessen. Future global steel demand growth will rely on reduced drivers, primarily concentrated in Asia. Investments in decarbonisation and dynamic emerging economies will increasingly drive positive momentum for global steel demand, even as China’s contribution to global growth diminishes.”