During his presentation at the SteelOrbis 2022 Spring Conference & 86th IREPAS Meeting held in Istanbul on May 29-31, Alexander Gordienko, export director of Spain’s CELSA Group, stated that global economic growth is projected to slow down to 3.6 percent in 2022 and 2023 from 6.1 percent in 2021, amid the effects of the war in Ukraine, higher commodity and energy prices, and inflation.
As for GDP growth expectations Mr. Gordienko stated that the outlook for growth in the advanced economies for 2022 was revised from last July’s 4.4 percent to 3.3 percent in April, and economic growth is expected to be 2.4 percent in 2023. Growth in the emerging markets and developing economies is estimated to be at 3.8 percent in 2022, revised down from 5.2 percent in the previous forecast, and at 4.4 percent in 2023. The outlook revision for the advanced economies is due to higher energy prices resulting from the war in Ukraine. Regarding inflation, Gordienko stated that the war between Ukraine and Russia and a broadening of price pressures are expected to elevate inflation for a longer period than previously forecast.
Stating that the construction industry in the EU moves in parallel with the GDP levels, the CELSA export director said that construction output increased in all European countries in 2022, especially in Spain, while it remained flat in Germany.
Regarding the global steel production, Mr. Gordienko stated that there was significant growth in 2021, though production is expected to slow down in 2022. In the January-March period this year, global steel production decreased by 6.8 percent to 456.6 million mt. In the given period, China was the number one steel producing country with 243.4 million mti down by 10.5 percent year on year.
In 2021, global steel demand totaled 1.87 billion mt. As for next year, Mr. Gordienko stated that global steel demand is expected to decrease by 1.8 percent year on year to 1.84 billion mt, while in 2023 steel demand will see a further growth of 2.2 percent, reaching 1.88 billion mt. Stating that Russia and Ukraine accounted for 13.5 percent of global steel exports, with Russia being the second largest exporter after China, he said that, if China manages to achieve a full recovery from the pandemic, its exports will increase in the coming years.
In terms of long products, the CELSA official stated that he expects consumption to decrease by 10 percent year on year in 2022. On product basis, wire rod and rebar consumption will see decreases of 15.5 percent and 11.1 percent, respectively, while merchant bar and sections consumption is expected to fall by 2.4 percent and 7.5 percent, respectively, all year on year. In particular, CELSA Group estimates rebar consumption will reach 378 million mt in 2022. He stated that long steel prices in May this year rose to the levels not seen since 2018 amid high energy prices. However, he added that prices have come back to pre-war levels now.