The global demand for steel will grow by 4.5 percent in 2021 and reach 1,855.4 million tons after scant growth recorded in 2020, the World Steel Association said.
Strong manufacturing activity bolstered by pent-up demand is the main contributor to the recovery, it added.
In 2022, steel demand will see a further increase of 2.2 percent to 1,896.4 million tons if higher vaccination rates across the world curb the spread of coronavirus variants, it said.
“2021 has seen a stronger than expected recovery in steel demand, leading to upward revisions in our forecast across the board except for China. Due to this vigorous recovery, global steel demand outside China is expected to return earlier than expected to its pre-pandemic level this year,” said Saeed Ghumran Al Remeithi, CEO of Emirates Steel and chairman of the economic committee of the association.
In the GCC, demand recovery fell short of expectations on the back of reduced construction activity due to fiscal consolidation efforts, said Al Remeithi. However, in 2022, with rising oil prices and the pandemic under control, steel demand is expected to rebound more strongly.
"Egypt's steel demand was negatively affected by the suspension of construction licenses in overcrowded urban areas. However, the government's other mega projects have cushioned the pandemic's impact and have supported recovery in 2021,” said Al Remeithi.
However, the steel body doesn't expect a growth in Chinese demand in 2022. Indeed, for the rest of 2021 growth will be negative due to the slowing momentum in the real estate sector due to tough government measures on developers' financing and the government cap on steel production. "As a result, overall steel demand is expected to decline by -1.0 percent in 2021," the report added.
Abu Dhabi-based Emirates Steel is one of the largest integrated steel manufacturers in the Middle East region.
(Writing by Brinda Darasha; editing by Seban Scaria)
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