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Commodity Market Report

Steel Market Service - Q3 2021 Outlook to 2035

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30 September 2021

Steel Market Service - Q3 2021 Outlook to 2035

Report summary

Tides are turning in 2021 as Chinese demand remains subdued and ROW steams ahead. 1) Has Chinese consumption peaked yet? How swift will the fall be? 2) Do emerging economies like India have enough potential to counter the demand loss from China? 3) How will steelmaking evolve in a decarbonising world and what will be its impact on metallics demand? The steel market long-term outlook provides detailed supply and demand analysis and price forecasts for the steel market out to 2035. The latest dataset upto 2050 is available now on the Wood Mackenzie portal.

Table of contents

    • Broad-based recovery in 2021; China to stay flat on high base
    • Demand growth to slow over the longer term
    • China slows in 2021, green shoots emerge across RoW
    • India and Southeast Asia to lead in the long term, Chinese output will fall
    • Evolving decarbonisation goals to alter steelmaking methods
    • Demand
    • Medium-term demand: consumption to plateau to 2022 before sliding down
    • Long-term demand: weak demographics make ideal case for demand to decline
    • Supply
    • 2021 crude steel production to grow at 2% year-on-year
    • Medium term: metallics share to shift with increased focus on scrap use in steelmaking
    • Long term: DRI production to ramp up
    • Demand
    • Steel demand to rise 10% year-on-year but remain below pre-pandemic levels
    • Medium-term demand to be driven by construction sector
    • Evolving demographics and low penetration offer tremendous growth opportunities for India
    • Supply
    • Second Covid wave failed to impact steel supply drastically
    • Indian integrated steel players to go big on capacity expansions
    • Green steel to make inroads but BOF will remain dominant technology in the long term
    • Demand
    • Japan
    • Steel to partially recover from COVID-19 impact
    • Long-term prospects remain weak
    • South Korea
    • South Korea continues to outperform Japan
    • Automobile and shipbuilding to lead in the medium term
    • Growth to falter over long term
    • Supply
    • Japan
    • Supply to be controlled via restructuring measures
    • South Korea
    • Japan leads the fight against decarbonisation
    • Steel demand to rebound 6% in 2021 after a dismal 2020
    • Bullish long-term prospects on strong fundamentals
    • Infrastructure thunder grips the region
    • Housing and automotive production to offer support
    • Rising domestic steel output will counter imports
    • Rise in BOF output will support hot metal; growth in scrap and DRI to accelerate post 2035
    • Shift away from blast furnaces accelerates in the late 2030s
    • Steel demand turns a corner
    • Supported by exports, Turkish production has fared well
    • Steel demand revived in 2020, growth outlook modest
    • Steel on a modest growth trajectory
    • Iran to exceed 55Mt steel capacity target by 2025, growth in exports to slow
    • Investments in construction to support steel consumption
  • North Africa
    • Demand rebounds post lifting of construction ban
    • Steel production aided by import safeguards
    • Demand to remain subdued
    • Steel production to rise, deterring imports
  • MENA: Metallics Demand
    • Russian automotive industry – bullish growth rates but from a low base
    • National projects are driving construction activity
    • Ukrainian steel production will not return to its former glory
    • Central Asian countries have strong growth prospects
    • Construction: (modestly) better prospects
    • Automotive: long-term fall is (still) inevitable
    • Machinery to grow, but prices must ease
    • EAF dominance to expand, but imports to dampen steelmakers’ ambitions
    • The path to green steel: H-DRI coming to the scene
  • Mexico and Canada
  • Brazil
    • Iron ore prices drop helps steel costs
    • Coal
    • Scrap prices starting to weaken
    • Steel prices to take few more 2-3 years to come back to 2020 levels
    • Steel price forecast
    • Scrap demand and prices
    • Metallics price forecast

Tables and charts

This report includes 77 images and tables including:

  • Demand growth by region
  • Global steel production outlook: EAF share to rise
  • Regional steel production outlook (2020-2035)
  • Crude steel production forecast changes
  • Apparent steel consumption forecast changes
  • Southeast Asia: demand outlook by country
  • Vietnam and Indonesia to expand demand share
  • Middle East: steel consumption outlook
  • EAF to remain the dominant route
  • Steel output to rise at a 2.5% CAGR till 2035
  • Utilisation levels to improve for UAE
  • North Africa: steel consumption outlook
  • Rising steel output to elevate utilisation levels
  • DRI production to rise 2% annually till 2035
  • Scrap demand to triple by 2035
  • Canada's lost steel demand from cancelled pipelines
  • Mexico's sectoral industrial production
  • Demand, supply and trade
  • South America (ex-Brazil) steel demand
  • Global average crude steel production costs
  • Residential construction to decline but non-residential to remain stable in the medium term
  • Growth in infrastructure fixed asset investment (two-year average) on a downward trajectory
  • Near-term steel demand
  • Medium-term steel demand
  • Receding birth rate and contracting working population suggest weak demographics
  • Urbanisation to witness a steep fall during 2020-2025
  • Margins tumbled in May causing prices and production to tame
  • Sharp decline in monthly production from April
  • Metallics mix to change in light of emissions control
  • Hydrogen-based steel to kick off after 2040
  • Steel production forecast by technology
  • Growth rates by sector (%)
  • Steel demand outlook (Mt)
  • Monthly crude steel production (Mt)
  • Exports remained strong in 2021
  • Capacity additions by large Indian steelmakers
  • Steel capacity and utilisation levels
  • Steel production by technology
  • South Korean demand to overtake Japan in 2026
  • Japan’s steel capacity to shrink 22Mt by 2035
  • Crude steel production: Japan and South Korea
  • Hydrogen-based steel production outlook
  • Key emission reducing projects in Japan and South Korea
  • Southeast Asia: Key infrastructure projects
  • Share of BOF capacity to rise
  • Finished steel imports as % of demand to decline
  • Share of HM to rise; DRI to catchup later
  • Hydrogen-based steel production outlook
  • EU ETS cap for total industry and EU + UK crude hot metal production indexed to 2019 – the year when integrated sites would have had few allowances.
  • European steelmaking strategies
  • Key emission reducing projects in Europe
  • Capacity surge will be led by Iran
  • Overcapacity in Iran as production fails to catchup
  • National projects: investment shares by sector
  • Russian exports should increase to close the emerging global supply gap after 2030
  • Bipartisan Infrastructure Framework capital allocation
  • Construction demand
  • Steelmaking by route
  • EAF burden mix
  • BOF vs EAF crude steel cash costs 2021
  • Global crude steel costs 2021
  • China hot rolled coil price and cost
  • Europe hot rolled coil price and cost
  • China rebar price and cost
  • Europe rebar price and cost
  • US hot rolled coil price and cost
  • US rebar price and cost
  • HRC price forecast
  • Rebar price forecast
  • Scrap price forecast
  • Metallics price forecast

What's included

This report contains:

  • Document

    Steel Market Service - Q3 2021 Outlook to 2035

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