Product category:
Engineering Industry Reports and Surveys
News Release from: MEPS (International)
Edited by the Engineeringtalk Editorial
Team on 20 September 2004
Record breaking steel demand to continue
to 2008
The global steel sector is entering a new phase, according to a new report "Global iron and steel production to 2008", published by MEPS (International).
The global steel sector is entering a new phase, according to a new report "Global iron and steel production to 2008", published by MEPS (International) Growth in China has stimulated demand for steel across the Asian continent
This article was originally published on Engineeringtalk on 4 Nov 2005 at 8.00am (UK)
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The emerging and developing countries in the region are showing strong manufacturing activity - based on exports to the industrialised nations.
Steel consumption is expected to move upwards over the next five years.
The fortunes of the world steel scene cannot be estimated using regressive analysis.
Previous cyclical trends are not being followed.
Boom conditions currently apply - based mainly on perceived raw material shortages.
In the three years between 2001 and 2004 MEPS estimates that apparent consumption of finished steel expanded from 766 to 918 million tonnes.
This represents an increase of almost 20% or a year on year average of more than 6%.
This compares to a rate of 2.5% per annum in the ten years to 2002 and a 1.2 annual percentage over three decades, 1970 to 2000.
MEPS estimates global apparent consumption of finished steel in 2004 at 918 million tonnes - 5.3% above the year earlier figure.
The company does not expect the recent growth rates to continue into the medium term.
However, it is forecasting further expansion in demand over the next few years - with apparent consumption of finished steel reaching 1 billion tonnes in 2008.
This equates to an average annual increase of almost 3% over the next five years.
This rather modest prediction is based on two key factors.
First, apparent consumption growth over the last three years is, in MEPS' opinion, above the level of real demand.
A large amount of inventory building has occurred, particularly in China.
The talk of shortages of raw materials has prompted buyers to carry higher stock levels than previously considered necessary.
Low interest rates have made this exercise much less painful than in the past.
Secondly, the Chinese Government is keen to avoid overheating of its economy.
It is making attempts to reduce growth in key industrial sectors, including steel.
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