The European distributors’ association Eurofer has expressed its concerns over the rising uncertainty and slowing global economic growth. Investment growth slowed in 2018 and rising trade frictions and a no-deal Brexit meanwhile are putting European steel consumption at risk for 2019 says Eurofer director of market analysis Jeroen Vermeij. He was speaking during the EUROMETAL Iberia Steel Net Forum, held in Seville on 22 March and attended by Kallanish.
EUROMETAL foresees nevertheless that the steel demand will be moderately positive during 2019 and 2020.
“Consumption is set to increase 0.5% this year and by a further 1.2% in 2020, but the EU steel trade deficit is still high at 17 million tonnes. EU imports rose by 12.3% year-on-year in 2018 and this is a reason for concern. From every three tonnes of steel arising from the diversion [… of trade] due to the US Section 232 ruling, nearly two tonnes arrive in the European market. Turkey and four other countries represent 65% of total imports in the region,“ Vermeij says. Imports have also continued to be higher in January and February 2019, he adds.
The construction sector is set to be the best-positioned in the coming years. Output is expected to rise by 2.1% in 2019 and by 1.2% in 2020, following 5% growth seen during past year, Eurofer says. The automotive industry has been hit by new WLTP regulations and subsequently saw reduced demand across Europe, weakening the sector’s position in the global market. Eurofer expects vehicle production to increase by 1% in 2019 however and to grow further by 2.4% in 2020.