The toughest period for EU steel end-use sector growth – the fourth quarter of 2022 and first quarter of 2023 – appears to be over. However, the rest of 2023 is expected to be characterised by a combination of uncertainty in energy prices, low industry demand and inflation-driven economic challenges, says Eurofer.
The Steel Weighted Industrial Production index (SWIP) is forecast to grow 1.3% on-year in 2023 – compared to the previous 0.3% growth forecast – and then slow to 0.4% in 2024 due to a downturn in the automotive sector, Kallanish notes.
EU steel-using sector output continued to grow in first quarter, showing unexpected resilience. The SWIP increased 3.7% on-year, driven by the automotive, mechanical engineering and transport sectors, the European steelmakers’ association observes.
However, domestic appliances, tubes and metalware output slumped, while construction grew only 0.1% and is expected to experience recession in 2023.
The deterioration of the overall economic and industrial outlook in the EU – particularly due to high inflation and the subsequent interest rate hike by the ECB – have so far impacted steel-using sectors’ output only to a limited extent, Eurofer concludes.
Adam Smith Poland