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EUROFER Update on Real Steel Consumption in EU

Steel News - Published on Thu, 13 Feb 2020

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EUROFER announced that real steel consumption in EU fell by 1.6% YoY in the third quarter of 2019 and stood at 38.5 million tonnes. The continued slowdown in production activity of steel-using sectors, coupled with reduced steel intensity, led to a fall of 1.6% YoY in real steel consumption in the third quarter of 2019, continuing along the trend already observed in the second quarter (-0.9%). The ongoing economic slowdown and business uncertainty have continued to result in decreasing steel intensity. This implies that the ratio of steel consumption to steelweighted production in steel using industries has continued to decrease. That is to say, during market downturns this leads to a reduction of the steel content in the final output per unit in the steel using sectors.

Faltering output growth in EU steel-using sectors over the 2019-2020 period, despite some recovery over the second half of 2020, in combination with the continued downward trend in steel intensity will result in a drop of real steel consumption of 1.1% in 2019 in annual terms. This will mark the first negative growth in EU real steel consumption since 2013, which will be followed by another drop in 2020, albeit more moderate, i.e. of 0.4%. Real consumption is expected to recover only in 2021, with a growth rate of 1.4% business conditions in the steel-using sectors should somewhat improve during 2020. The construction sector will prove resilient and continue to record output growth, while other steel-using sectors, automotive in particular, will continue to experience a downturn in production in early 2020, but at lower rates, followed by a modest recovery from the second quarter of 2020 onwards. The negative impact of decreasing steel intensity is also expected to soften. As a result, real steel consumption is expected to have reached 161.5 million tonnes in 2019, 160.9 million tonnes in 2020 and 163.2 million tonnes in 2021.

Forecast for Real Consumption
% change year-on-year
% change-1.1-2.2-

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Posted By : Rabi Wangkhem on Thu, 13 Feb 2020
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