SEATTLE (Scrap Monster): The latest market report published by the Latin American Steel Association (ALACERO) foresees significant dip in steel demand in the region during the current year. The demand could be hit badly by several factors, including inflationary pressures, price hikes on account of Russian invasion of Ukraine and political instability. It must be noted that the regional steel industry had bounced back in 2021, following the pandemic-related restriction during the year prior to that.
According to Alejandro Wagner, President, ALACERO, the regional steel demand is expected to record decline by around 2% in 2022. The largest steel-consuming sectors such as construction and automobile manufacturing have shrunk so far during the year. Meantime, the report predicts 4% year-on-year recovery in steel demand during 2023.
The Latin American construction sector has contracted by 3% during the initial quarter of 2022, whereas the automotive sector witnessed a fall by 1.2% year-on-year during February to April this year. In Mexico alone, the construction sector dropped by 0.2% in May, said the country’s statistics agency.
The industry report foresees some bright spots though. The regional steel industry may get a much-needed boost from infrastructure projects like the Vaca Muerta pipeline.