The global shipment for steel decreased by 9.6% in Q3 2021 as compared to Q2 2021, and also declined by 2% from Q3 2020. Global steel shipment fell in Q3 2021 due to significant decline of steel production in APAC; APAC contributes more than 70% of the global steel production. China, the world’s largest steel making nation, produced 243.8 Mt of crude steel in Q3 2021, a decrease of 16% compared to Q2 2021. The sharp decline in steel production is due to the small waves of infections, slowing momentum in the real estate sector, and the government cap on steel production in China. Globally, the price of steel decreased by 3.8% in Q3 2021, as compared to Q2 2021.
In Q4 2021, the global demand for steel is expected to increase by 1.3% from Q3 2021, and price is forecasted to decrease by 1.6% in Q4 2021 vs Q3 2021. The figure below depicts the change in demand and change in the price of steel over the past five quarters and one forecast quarter.
Source: World Steel Association, Lucintel
Figure 1: Global Quarterly Steel Shipment and Price Trends
North America
The North American steel production witnessed growth of 1.3% in Q3 2021 as compared to Q2 2021, white it is expected to maintain the growth in Q4 2021 as well. Although, housing starts in the US declined by 1.4% during Q3 2021 from Q2 2021, the steel industry increased in Q3 2021. The steel demand in North America expected to increase further mainly driven by growth in major end use industries such as automotive and industrial activities.
Europe
In terms of steel production in the European region, data indicates decrease of 4% in Q3 2021 as compared to Q2 2021, but it is expected to increase in Q4 2021. The European steel market decreased in Q3 2021 due to decline in various end use industries including transportation and industrial applications. European steel demand is expected to increase in next quarter of 2021 with recovery in construction and automotive industries. In terms of price, the European region registered a decrease in price of crude steel during Q3 2021 as compared to Q2 2021.
APAC
In Q3 2021, production of crude steel in the Asian region declined by 12% as compared to Q2 2021, while it is expected to increase in Q4 2021. Countries like China, India, and Japan produced around 297 million metric tons of crude steel during Q3 2021, a decrease by 13% from the Q2 of 2021. The demand for steel decreased due to the low demand of end use industries, while the price of steel in the same period declined due to production cuts, power issues, falling steel demand, and an oversupply of iron ore. Asian steel demand is expected increase in Q4 due to growth in various end use industries such as automotive, domestic appliances, and construction.
RoW
In RoW, steel production declined by 4.1% in Q3 2021 as compared to Q2 2021 but it is expected to increase in Q4 2021. The steel demand decreased in Q3 2021 due to decline in industrial activities and challenges in supply chain. It is expected to increase in next quarter with recovery in import and export activities and increased trade activities.
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