Domestic steel use is estimated to grow by 6.2% to 80 million tonne in 2015 up from 75.3 mt in 2014, bucking the global trend which is expected to post a slower growth in steel demand in 2015 mainly due to lower steel output in China.
The World Steel Association has said in its latest forecast that global steel use will go up by 0.5% to 1.55 billion tonne (bt) in 2015, a shade lower than the 0.6% increase shown in 2014 suggesting a slow growth for global steel demand.
While India is anticipated to use 85.8 mt of steel in 2016, the WSA which released its Short Range Outlook (SRO) for 2015 and 2016 said in 2016, world steel demand is forecast to grow by 1.4% to reach 1.56 bt.
However, among the top ten steel using countries China, the leading global steel user, is expected to slide to a production level of 703.7 mt in 2016 against 710.8 mt in 2014. The US which is ranked second in steel use is likely to report a marginal growth to 107.2 mt in 2016 from 106.9 mt in 2014, according to the WSA forecast.
Commenting on the outlook, Hans Jurgen Kerkhoff, Chairman of the worldsteel Economics Committee said, "We are releasing a restrained growth outlook for the global steel industry mainly due to the deceleration in China.
The outlook also reflects the influence of major structural adjustments in most economies, particularly owing to limited investment growth post 2008."
"While we continue to face some downside risks coming from some parts of Europe - geopolitical instability, international capital flow volatility and the economic slowdown in China - the impact of these risks has come down. We hear increasingly positive news from developed economies, especially signs of firming recovery momentum in the Eurozone. In the developing and emerging world, we see increased optimism about India and growth in steel use in some MENA and ASEAN countries. While these developments will not be enough to counterbalance the deceleration of China, we expect to see gradually improving growth prospects beyond 2016," Kerkoff concluded.
An interesting factor which has become increasingly apparent is that in some developing economies the steel markets are beginning to exhibit the characteristics of mature markets, the WSA said.