The global iron & steel market is expected to witness rapid growth owing to strong demand from construction and transportation sector over the forecast period. Rapid industrialization and urbanization, particularly in the emerging regions such as Asia Pacific and Central & South America are expected to drive the overall iron & steel market.
Steel production is the largest iron ore application. It is basically an iron alloy along with carbon, and other additive metals such as boron, manganese, nickel, titanium, chromium, molybdenum, and vanadium. These additive metals impart different characteristics of steel in order to make it suitable for multiple applications.
Major ores include hematite, limonite, magnetite, goethite, and siderite. Among these different ores, hematite and magnetite are rich in iron and contain more than 60% iron. Based on carbon content, there exists pig iron, wrought iron, and cast iron. Pig iron has dominated the market in the past, and it is expected to continue to dominate the market over the forecast period
Growing demand from the building and construction industry owing to rapid infrastructure initiatives undertaken by governments especially in the emerging regions is projected to aid in industry growth. Building & construction industry is the dominant end-use industry for this iron & steel market followed by automotive & transportation.
Emerging economies such as Brazil, China, Russia, and India have witnessed rapid automotive demand owing to factors such as rising disposable income, rapid urbanization, and increase in population. This trend is presumed to continue over the forecast period, and thus, assist the regional market in the near future.
Economic scenario in the developed regions such as North America has witnessed a revival in the recent years after the global economic meltdown. The European economy is projected to witness a similar revival owing to strong steps taken by the concerned governments. Initiatives such as these are projected to complement the regional markets.
Environmental concerns regarding excessive mining have resulted in several regulations being implemented to curb mining. Emerging economies such as China, which is the largest consumer of steel, has witnessed government regulations mandating steel companies to limit its production in a bid to reduce mining. This kind of regulatory framework is anticipated to hamper the regional as well as global iron & steel market.
China has to witness brisk demand growth in the recent past. This growth has encouraged several industry participants to increase their production capacity in a bid to meet the demand. However, such rapid growth in production capacities has resulted in chronic overcapacity which has driven down prices. Any impact in the Chinese market cascades across the global iron & steel industry as China is the largest consumer and producer of steel.
The global economic meltdown has resulted in decreased infrastructure spending and manufacturing initiatives. Though the economic scenario is looking positive in the near future, end-use industries are projected to take some time before reaching their pre-economic meltdown stage.
Increase in awareness related to harmful mining effects has resulted in increasing iron recovery from scrap. Recovery from scrap also has the benefit of being cheaper than mining. Thus, changing consumer preferences and increasing awareness have resulted in the scrap industry witnessing brisk growth over the recent past. Fluctuating prices are projected to further aid the scrap industry owing to its economic benefits.
R&D initiatives to develop environmentally friendly mining technologies offer ample opportunities for the iron & steel industry participants. Developing steel with superior characteristics that meet the customer specifications is another key area that is expected to promise abundant scope for rapid growth and development.
Major iron and steel producing countries are China, India, Brazil, Japan, Australia, South Korea, Germany, and Ukraine. Asia Pacific is estimated to witness the fastest growth rate and is thus poised to dominate the global iron & steel market. Economies such China, India, and other South-East Asian economies are presumed to lead the regional market. Developed regions such as North America and Europe are projected to experience a positive market outlook owing to considerable economic revival over the forecast period.
Major industry participants in the iron & steel market include Bridon International Ltd., ArcelorMittal S.A., Kobe Steel Ltd., Insteel Industries Inc., N.V. Bekaert SA, Steel Authority of India Ltd. POSCO, Tata Steel Ltd., Rio Tinto, BHP, Vale, Tree Island Industries Ltd., and Leggett & Platt Incorporated.
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The global construction industry, once thriving with increased investments, has been severely affected by the suspension of the construction activities in the wake of the ongoing pandemic. Shortage of labors coupled with potential supply chain bottlenecks of materials and equipment is expected to cause project delays in the ongoing funded projects and may lead to reduced spending in the upcoming projects. Uncertainty around the actual duration of the prevailing lockdown makes it hard to anticipate how a recovery in the construction industry will unfold. On similar lines, the HVAC industry has been adversely affected by the COVID-19 outbreak due to the shutting down of several component manufacturing facilities across China, European countries, Japan, and the U.S. This has consequently led to a significant slowdown in the production of HVAC equipment. Lockdowns imposed by the governments in the wake of the Covid-19 outbreak has not only affected manufacturing but also pegged back the consumer demand for HVAC equipment. The report will account for Covid19 as a key market contributor.