×
In 2022, the global economy fell back sharply against the backdrop of recurring epidemics, the Russia-Ukraine conflict, the energy crisis, and inflation. In terms of developed economies, the global economic slowdown has increased the risk of a world recession as inflation continues to rise and the Federal Reserve raises interest rates sharply. Emerging markets and developing economies are also facing greater pressure in the process of global economic recovery is blocked, most countries are relatively weak in epidemic prevention capacity and policy support, the Russian-Ukrainian conflict brought about by the obstruction of food and energy supply and rising energy prices and other issues on these countries to hit even harder, and the Fed sharply raised interest rates is leading to domestic capital outflows from these countries, forcing them to raise interest rates even faster, which in turn will weigh heavily on the economy. It is worth mentioning that, although China's economic growth rate in 2022 appeared to be a certain decline, with the stabilization of the economic package of policies and successive measures gradually landing, China's economic development has begun to show signs of stabilization and rebound, 2023 is expected to become an important engine to promote the recovery of the global economy.
How will global steel demand change in 2023? Sub-regionally, global steel demand in 2023 will be characterized by the following:
Asia – In 2022, under the influence of the tightening global financial environment, the Russia-Ukraine conflict, and some slowdown in China's economic growth, Asia's economic growth faces greater challenges. Looking ahead to 2023, Asia is in a favorable position for global economic development and is expected to enter a phase of rapid decline in inflation, and economic growth will outpace other regions. According to the International Monetary Fund (IMF) forecast, In 2023 Asian economic growth rate of 4.3%. Comprehensive judgment, 2023 Asian steel demand is about 1.273 billion tons, an increase of 0.5%.
Europe - Russia-Ukraine conflict, the global supply chain tends to be tense, and energy and food prices continue to soar. In 2023 European economy will face great challenges and uncertainty, high inflationary pressure caused by shrinking economic activity, energy shortages brought about by the industrial development problems, rising living costs of residents, and business investment confidence suffering a serious blow will become a hindrance to the development of the European economy. Comprehensive judgment, the demand for steel in Europe in 2023 is about 193 million tons, a year-on-year decline of 1.4%.
CIS countries - Since the outbreak of conflict between Russia and Ukraine, the two major economies of the CIS, the CIS countries, economic development has been seriously hampered. In 2023, the Russian-Ukrainian conflict is still a large uncertainty in the development of the situation, the European Union, "de-Russianization" and the G7 countries, such as the sanctions against Russia will continue. In 2023, considering Russia's steel demand accounted for about 75% of the total steel demand in the CIS. In 2023, considering that Russia's steel demand accounts for about 75% of the total steel demand in the CIS, by the impact of sanctions, Russia's machinery, automobiles, and other important parts of the imports are blocked, the main downstream steel industry demand tightening, or will lead to a further decline in the demand for steel in the CIS countries. Comprehensive judgment, steel demand in CIS countries in 2023 is about 50 million tons, down 6.1% year-on-year.
North America - The International Monetary Fund forecasts that in 2023, the economic growth rate in North America will be 1.0%. High-interest rates will increase the cost of corporate financing, which is not conducive to the development of steel-using industries such as manufacturing and construction. In addition, the U.S. newly enacted infrastructure law will promote infrastructure investment and energy industry investment growth, which in turn drive the growth of steel demand. Considering the development of the North American economy and the construction, manufacturing, automotive, energy, and other industries in 2023, it is expected that the demand for steel in North America in 2023 will be approximately 143 million tons, an increase of 1.0% year-on-year.
South America - In 2023, dragged down by high global inflation, most countries in South America will face greater pressure to revitalize their economies, control inflation, and create jobs, and economic growth will slow down. The International Monetary Fund predicts that in 2023, the South American economy will grow by 1.6%. Among them, in infrastructure construction, housing construction renewable energy projects, ports, and oil and gas project construction, driven by Brazilian steel demand is expected to rise, directly driven by the rebound in steel demand in South America. Comprehensive judgment, South American steel demand amounted to about 42.44 million tons, an increase of 1.9%.
Africa – In 2022, Africa's economic growth rate is faster. Under the influence of the Russian-Ukrainian conflict, international oil prices rose sharply, and some European countries turned their energy demand to Africa, so that the African economy was effectively boosted. The International Monetary Fund predicts that in 2023, Africa's economy will grow by 3.7% year-on-year. In the oil prices remain high and many infrastructure projects to start construction of the double benefit, in 2023, Africa's steel demand is expected to reach 41.3 million tons, an increase of 5.1% year-on-year.
Middle East - In 2023, the economic recovery in the Middle East will depend on measures such as international oil prices, anti-epidemic measures, the scope of policies to support growth, and measures to mitigate the economic damage caused by the epidemic. At the same time, geopolitical and other factors will create uncertainty for economic development in the Middle East. The International Monetary Fund forecasts that the economic growth rate of the Middle East region will be 5% in 2023. Comprehensive judgment, the demand for steel in the Middle East in 2023 is about 51 million tons, a year-on-year growth of 2%.
Oceania - The major steel-consuming countries in Oceania are Australia and New Zealand. In 2022, economic activities in Australia gradually recovered and business confidence was boosted. New Zealand's economy rebounded thanks to the recovery of the service sector and tourism. The International Monetary Fund forecasts that in 2023, the economic growth rate of Australia and New Zealand will be 1.9%. Comprehensive forecast, the steel demand in Oceania in 2023 is about 7.1 million tons, an increase of 2.9% year-on-year.
From the point of view of the global major regions of steel demand forecast changes. In 2022, due to the Russian-Ukrainian conflict and economic downturn, Asia, European, CIS countries, and South American steel consumption are showing a downward trend. Among them, the CIS countries the Russian-Ukrainian conflict had the most direct impact on the economic development of the countries in the region a serious setback, steel consumption fell by 8.8% year-on-year. North America, Africa, the Middle East, and Oceania steel consumption showed an upward trend, year-on-year growth of 0.9%, 2.9%, 2.1%, and 4.5%. In 2023, it is expected that the CIS countries and the European steel demand will continue to decline, and steel demand in other regions will be a slight increase.
Changes in the pattern of steel demand from various regions. In 2023, Asia's share of steel demand will still be the world's first, maintained at about 71%; Europe and North America's share of steel demand will continue to maintain the world's second and third, of which Europe's share of steel demand will decline by 0.2 percentage points year-on-year to 10.7%, and North America's share of steel demand will increase by 0.3 percentage points year-on-year to 7.5%. In 2023, the share of steel demand in CIS countries will decrease to 2.8%, comparable to the Middle East; the share of steel demand in Africa and South America will increase to 2.3% and 2.4% respectively.
Comprehensive view, according to the global and regional economic development and steel demand analysis, global steel demand in 2023 is expected to reach 1.801 billion tons, an increase of 0.4%.
