The Short Range Outlook (SRO) for 2020 and 2021 released by the World Steel Association (worldsteel) forecasts notable decline in steel demand in the developed economies during 2020. The demand is expected to witness year-on-year decline by 17.1% during the current year. Meantime, the association predicts recovery of 7.8% in 2021.

The EU steel demand was expected to surge on account of anticipated demand boost from manufacturing sector. However, extended lockdown measures resulted in deep recession, which eventually led to massive fall in orders. The Association notes that automotive sector is likely to take the biggest hit. The construction sector may remain resilient.

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The ongoing manufacturing recession in the U.S. is expected to dip to its lowest level in the second quarter of 2020. The reduced income levels resulting from surging employment is feared to impact residential construction. Meantime, the non-residential construction is expected to see a recovery in 2021.

The Japanese steel demand is expected to see double-digit contraction in 2020 with reduced demand from automotive, machinery and construction sectors. The major steel-consuming sectors in Korea including shipbuilding and construction are likely to see a double-digit decline.

The report predicts 6.4% contraction in global steel demand in 2020, followed by 3.8% year-on-year recovery in 2021.