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2
Mounting uncertainties cloud growth prospects
3
Global economic growth remains weak
Source: IMF
4
Global steel demand
Steel demand, finished steel (SRO October 2016)
2015
1 498.7 million tonnes, -3.0% growth
2016 (forecasts)
1 501.3 million tonnes, 0.2% growth
2017 (forecasts)
1 509.6 million tonnes, 0.5% growth
Source: worldsteel
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Regional steel demand
Steel demand, finished steel (SRO October 2016)
million tonnes (Mt) %
2017 as
2015 2016 2017 15/14 16/15 17/16 % of 2007
European Union (28) 153.6 154.8 156.9 2.9 0.8 1.4 77.3
Central & South America 45.6 40.8 42.5 -6.7 -10.4 4.1 103.0
Asia & Oceania 983.4 987.9 984.3 -3.3 0.5 -0.4 143.6
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The China deceleration continues
GDP growth in H1 of 2016 hit a 7-year low with continuous deceleration of
investments
Increasing contribution of consumption and service sector to growth
In 2016, Government stimulus boost infrastructure investment and real estate
sector
However, stimuli are limited and the rebound may not be sustainable
GDP and FAI growth, % Real estate and infrastructure investments growth, %
Source: NBS
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Will India drive global growth?
So far the economy reporting a solid performance
improving macroeconomic fundamentals
government infrastructure projects
series of consumption and investment friendly reforms
but industrial production growth remains weak, share of investment in GDP
was reduced
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
states, due to varied activity level in steel
Gujarat Haryana
using sectors Maharashtra Rajasthan
Chhattisgarh Jharkhand
Orissa West Bengal
Source: worldsteel
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Growth momentum to remain weak
Global steel demand recovery momentum started to falter after 2013
when Chinese steel demand peaked
Recovery momentum in the developed world is stagnating
China‘s share has contracted since 2014 after reaching 48% in 2013
Steel demand, finished steel, 2007=100 Regional share in world steel demand, %
Source: worldsteel
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Long term view: steel industry at another inflection point
1 400 +6.7%
CAGR 1976-2000
1 200 +1.1%
1 000
800 CAGR 1950-1975 RoW
+5.0%
600 China
400
former USSR
200
US, EU, Japan
0
1950
1955
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2010
2015
Source: worldsteel, steel demand crude steel equivalent
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Steel demand is facing new challenges
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Indirect trade in steel is becoming increasingly important
World direct and indirect exports of steel Indirect trade in steel, selected net exporters by sectors
Mt Turkey, metal prod. Mt Thailand, automotive
2.0 2.5
Mt
Direct exports Indirect exports 2.0
500 1.5
1.5
450 1.0
1.0
400 0.5 0.5
350 0.0 0.0
2005
2007
2009
2011
2013
2015
2005
2007
2009
2011
2013
2015
300
250 Mt Turkey, dom. app. Mt Mexico, automotive
0.6 9
200 0.5
8
7
150 0.4 6
5
0.3
100 4
0.2 3
50 2
0.1 1
0.0 0
0
2005
2007
2009
2011
2013
2015
2005
2007
2009
2011
2013
2015
2000 2005 2014
Source: worldsteel
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Summary and conclusions
13
Thank you for your attention.
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worldsteel.org