Commodity Market Report

Global steel long-term outlook Q1 2019

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02 April 2019

Global steel long-term outlook Q1 2019

Report summary

The Global steel market long-term outlook provides the latest update of detailed supply and demand analysis and price forecasts for the steel market out to 2040. In the medium to long term, the key uncertainty revolves around India. Can India's steel-demand and production growth pick up robustly and reliably enough to offset the fading role of China as the engine of global growth? In the long term, available steelmaking technologies will be challenged by increasingly stringent environmental regulations.

Table of contents

    • Demand
    • What's changed
    • Property: another year of growth
    • 1. We expect some support to new starts
    • 2. Credit easing will make financing easier and cheaper for developers
    • 3. The upgrading of old housing will complement steel demand
    • 4. Non-residential property to recover in the medium term
    • Infrastructure investments to support construction steel demand
    • Manufacturing
    • Manufacturing downturn persists in 2019
    • Machinery: still robust, but losing momentum...
    • ...and will support steel consumption in the short term then automotive sector will take over
    • Demand abroad is at risk
    • Automotive sector turns sluggish...
    • ...but vehicle population still has room to grow
    • Huge demand for cars restricted in major cities
    • Lightweighting will be offset by preference for SUVs
    • Production
    • China's steel production to peak at 960 Mt in 2020, up 15 Mt from Q4 assessment
    • EAF will gradually displace– but won't topple– BOF in the long term
    • Capacity
    • China cuts 138 Mtpa net of steel capacity during 2016 to 2019
    • EAF capacity will increase to account for 15% of China's total
    • Risks
    • Hebei extends capacity rationalisation
    • Near term
    • Medium and long term
    • Japan steel production expected to decline more than hot-metal
  • South Korea
  • Taiwan
  • Thailand
  • Vietnam
    • Indian growth requires a huge capitalisation
    • India has unrivalled potential for demand growth
    • Commercial sector growth prospects are mediocre
    • Steel demand to increase by 200 Mt in 20 years
    • Where will the steel come from?
    • Imports are (not) an option
    • Most of the steel will be produced domestically, eventually
    • There is no shortage of steelmaking projects
    • BF-BOF steelmaking is gaining momentum
    • Mine lease auction will crystallise steelmaking expansion plans
    • Steel production forecast remains conservative
    • The increasing BF-BOF steelmaking is driving iron ore demand growth
    • Significant upwards revision to our long-term pellet usage rates
    • Steel demand growth in the EU automotive sector cannot continue indefinitely
    • Medium-term demand to lose
    • Capacity expansions are small
    • Hot metal outlook
    • Near term
    • Demand
    • Supply
    • DRI
    • Near term
    • Medium term
    • Long term
    • Construction
    • Automotive, household appliances and machinery
    • Production
    • At first glance, American steel is great again
    • Is the steel boom sustainable?
    • Half of the story is about demand
    • Automotive: foreign brands increasing production in the US
    • Today's automotive investments are in part offsetting long-term trends
    • Infrastructure spending supports construction steel demand
    • The machinery sector has lost out
    • Total steel demand is now revised up
    • The second half of the story is all about capacity
    • New capacity means that US production will remain higher for longer
    • Steel prices will come under pressure
    • EAF production will continue to dominate the industry
    • Changing metallics demand
    • Mexico
    • Canada
    • Construction
    • Automotive
    • Trade and production
    • Near term
    • Medium term
    • Long term
    • Near term
    • Medium term
    • Long term

Tables and charts

This report includes 41 images and tables including:

  • NAFTA steel trade structure
  • Steel demand in construction
  • Steel demand in manufacturing
  • China's scrap supply-demand balance
  • China's steel production by technology
  • China's steel capacity and changes by technology
  • China's steel capacity utilisation rate by technology
  • Hebei BOF unit and capacity distribution by size in 2019
  • Hebei BOF steel capacity and changes by size
  • Steel intensity in selected countries
  • India capacity: crude steel and hot metal
  • India steel projects by technology and status
  • Distribution of Indian steel projects
  • Pellet charge rates will increase rapidly...
  • ...pushing up pellet demand to ~150 Mt by 2040
  • EU demography
  • Finished steel demand by sector
  • EU crude-steel capacity
  • Turkey house sales
  • Turkey: EAF as a share of total crude-steel production
  • Turkey metallics balances
  • Brazil steel demand and supply
  • Brazil steel trade
  • US finished steel demand
  • US steel imports
  • Not all is what it seems – the ambiguity of capacity utilisation rates
  • US steelmaking capacity is shifting south
  • Current capacity boom supports EAF steelmaking
  • BF-BOF is still expected to fall in the long term
  • Steelmaking raw-material prices
  • Scrap price forecast
  • Scrap – hot-metal production costs
  • Scrap – hot-metal production costs
  • Quarterly scrap and metallics prices
  • Annual scrap and metallics prices
  • Quarterly steel prices
  • Annual steel prices
  • China rebar near-term margins at low-cost mill
  • Near-term rebar prices
  • Long-term hot-rolled coil price forecast
  • Long-term rebar price forecast

What's included

This report contains:

  • Document

    Global steel long-term outlook Q1 2019_V2.xls

    XLS 3.17 MB

  • Document

    Global steel long-term outlook Q1 2019

    PDF 4.92 MB

  • Document

    Global steel long-term outlook Q1 2019

    ZIP 5.65 MB

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