Carbon Steel Procurement Intelligence Report, 2023 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)

Carbon Steel Category Overview

The carbon steel category is expected to grow at a CAGR of 4.0% from 2023 to 2030. The APAC region accounts for the largest category share and is anticipated to be the fastest-growing region in the forecast period. Factors such as the rise in the need for carbon steel in infrastructure development, the automotive sector, construction sites, and machinery are driving the category growth. One of the key trends is the use of this product in the shipbuilding industry owing to the growing demand in China, and Southeast Asia. Availability of cheap labor and technological advancement are the reason companies are shifting their shipbuilding manufacturing to these countries.

High-temperature drawing (HTD), advanced metallurgy, and coatings are a few technological advancements that are generally used in this category to enhance the properties of carbon steel. HTD is used by manufacturers to reduce cost, production time, and the impact on environment during the production. Coatings and advanced metallurgy techniques are used by manufacturers to enhance durability and to give strengthening to the product thereby increasing protection from corrosion and less wear and tear resulting in an enhanced product life cycle. Companies are utilizing technologies to gain a competitive advantage over others. In 2020, U.S. Steel Corporation invested USD 1.2 billion in constructing a rolling and endless casting facility in Pennsylvania to reduce its environmental footprint and improve operational efficiency.

The category is consolidated with top players taking over and capturing a larger market share. They are constantly working on developing new and innovative products, solutions, and technologies to cater to the demand of larger industries and to have a competitive lead over others. Top players have strategically allied with other manufacturers to acquire the latest technology and outsource some of their operations to make the market competitive and extend barriers for new entrants. In 2021, Sumitomo Metal Corporation and Nippon Steel called a new business strategy – NSSMC Beyond 2022, to strengthen their market competitiveness and expand their business globally. Players are acquiring stakes to expand their business portfolios. In 2020, Tata Steel acquired the remaining 25.1% stake in the Tata Steel subsidiary company, Tata Steel BSL Limited. This acquisition helped in strengthening and expanding their product portfolio.

Coking coal and iron ore drives the steel price along with the effect of the supply-demand scenario of the category plays a major role in constituting the price. The prices of these raw materials are expected to remain volatile due to state-mandated measures to reduce carbon emissions and rising geopolitical tensions. Owing to strict lockdowns in Shanghai amid covid-19 pandemic and the Russia-Ukraine war have caused drastic effects in disrupting the supply chain. With easing curbs in restrictions and normalization in the supply chain have rallied the demand. In 2023, steel prices in China went up by 55.4% from USD 749 to USD 1,164 in April. With the U.S. and Europe back on inventory replenishment, demand for global supply increased resulting in an increase in prices of hot rolled carbon steel by USD 38.24 per tonne and hot rolled steel coils by USD 28.68.

Sourcing of the category involves procurement of raw materials and import of the final product from various countries. China, Russia, and Japan are the top exporters in this category. The wide availability of raw materials and large export of semi-finished and finished goods are helping them in leading the market. Best sourcing practices include reaching potential suppliers with the delivery of good quality raw materials, reduced lead time, competitive pricing, and meeting regulatory compliance. China dominates the category with the export of 66.2 million metric tons of its production. It exports majorly to the U.S., Vietnam, and India. It stands at the largest steel industry in the world and manufactures around half of all crude steel produced globally. Chinese producer, Baowu Group produces 120 million metric tons of crude steel, which is significantly higher than other producers around the world. 

Carbon Steel Procurement Intelligence Report Scope