Emerg­ing mar­kets buy more steel

The Weekend Australian - Travel - - Resources / School Appointments / Engineering & Mi -

THE In­ter­na­tional Iron and Steel In­sti­tute raised its fore­cast for global steel de­mand in 2008 be­cause of higher sales in emerg­ing mar­kets. The in­sti­tute, which is fi­nanced by the world’s big­gest steel­mak­ers, raised its 2008 global de­mand growth fore­cast by 0.7 per­cent­age point to 6.8 per cent. Con­sump­tion for 2007 will also rise by 6.8 per cent, 0.9 per­cent­age point more than pre­dicted pre­vi­ously, the in­sti­tute said in a state­ment handed out in Ber­lin, where it’s hold­ing its an­nual meet­ing.

Surg­ing de­mand from emerg­ing mar­kets may help steel­mak­ers over­come a slow­down in the US and ris­ing raw ma­te­rial costs. De­mand in Brazil, Rus­sia, In­dia and China will in­crease 12.8 per cent in 2007 and 11.1 per cent in 2008, the in­sti­tute says.

‘‘ De­mand will con­tinue to grow at a healthy rate,’’ says Paolo Rocca, IISI vicechair­man and chair­man of oil and gas tube pro­ducer Te­naris SA. ‘‘ The econ­omy in China is very strong and de­mand is very strong.’’

Chi­nese steel de­mand will in­crease 11.4 per cent in 2007 and 11.5 per cent in 2008, ac­count­ing for 35 per cent of world­wide con­sump­tion. The world’s largest na­tion will prob­a­bly ex­port be­tween 50 mil­lion and 55 mil­lion met­ric tons of steel this year, Rocca says.

Rus­sian steel de­mand will jump 25 per cent in 2007 and 9.5 per cent in 2008, led by new en­ergy and con­struc­tion projects.

Brazil’s steel de­mand will in­crease 15.7 per cent in 2007 and 5.1 per cent in 2008, on gov­ern­ment spend­ing. De­mand in the US, Canada and Mex­ico will fall 4.9 per cent this year, re­bound­ing 4 per cent next year.

‘‘ The IISI fore­cast as­sumes that the re­cent credit mar­ket volatil­ity will not move the US econ­omy into re­ces­sion,’’ IISI Chair­man and US Steel Corp chief ex­ec­u­tive of­fi­cer John Surma says.

De­mand in the Euro­pean Union will rise 4 per cent in 2007 and 1.4 per cent in 2008, led by Ger­man growth.

Bei­jing-driven boom: China’s growth will in­crease steel con­sump­tion

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