Sheet Metal Demand Forecast Suggests Sustainable Recovery

The WSA expects global steel demand to grow 1.3% in 2017 after 1% growth in 2016. The cyclical growth in steel sheet demand is expected to be driven by the ongoing recovery in developed economies, coupled with faster growth in emerging economies.

The United States is expected to drive growth in the developed world thanks to strong fundamentals, fiscal stimulus measures and rising infrastructure spending. Steel demand in the US is expected to rise 3% this year.

Recently, the eurozone economy has also received support. Steel demand in the European Union is expected to grow by 0.5% in 2017. This bodes well for companies like ArcelorMittal MT, which generate nearly half of the region's revenues. The United States and Steel Corporation also have a significant presence in Europe.

Demand for emerging and developed economies (excluding China) is also expected to grow by 4% this year. India is expected to be the next engine of growth given its progressive construction and manufacturing sectors along with rapid urbanization and structural reforms.

The rebound in the global economy and growth in the automotive and construction markets - two major consumers of rebar and steel sheet - should also provide a boost for the steel industry this year.