The World Steel Association (worldsteel) forecasts global apparent steel use will grow by 2.9% to 1454Mt in 2013 following growth of 1.2% in 2012.
This is expected to continue in 2014 with forecasted growth of 3.2%. Whilst demand from emerging markets remains the primary driver for this growth, there is also sustained steel consumption growth in the USA where there is, aided by averting the much talked about ‘fiscal cliff’, increased investor confidence and a recovery in the residential construction market is underway.
Alexey Mordashov, Chairman of Board of Directors of the World Steel Association and CEO of Severstal commented: “It is quite often said by industry experts that the recovery growth of steel demand in Russia is coming to an end. In Russia, despite some indications of slowing economic growth, there is still significant growth in steel demand and we even anticipate some acceleration further in 2013 driven by major investment projects which will require significant volumes of rolled steel and, specifically, high-value added steel products. In line with Severstal’s estimates, worldsteel forecasts growth in Russian steel demand of 2.6% in 2013 and of 3.9% in 2014, against recorded growth of 2.4% in 2012.
Consumption of pipes in Russia in 2013 is likely to grow primarily driven by two major investment projects, namely the South Stream and the Yakutia–Khabarovsk–Vladivostok gas pipelines. If the oil & gas industry’s current plans and projects are realized, this could lead to approximately a 20% increase year on year in large diameter pipes consumption, after delays across these major projects significantly reduced demand for large diameter pipes in 2012.
We also see the automotive industry as a key contributor to growth in Russian apparent steel use in 2013. We forecast automotive consumption growth of approximately 5-7% year on year. Overall, despite ongoing global macroeconomic uncertainty, at Severstal we anticipate that, over the next five years, annual steel consumption growth in Russia will be at least 3-4%.”