SEATTLE (Scrap Monster): The European Steel Association (EUROFER) warned that steel market is staring at a new recession or a stagflation scenario, mainly due to worsening energy crisis and rising shortage of raw materials. The steel market evolution in 2022 and 2023 remains subject to a high level of uncertainty, noted Axel Eggert, Director General of EUROFER.
According to the steel trade body, the positive trend in steel demand and apparent consumption during the first three quarters of 2021 persisted in the final quarter of the year as well, though at a slower pace. At the same time, EU steel imports surged higher significantly by almost one-third during the previous year. Looking into 2022, it expects the steel consumption to record its third contraction in four years.
The geopolitical tensions triggered by Russian invasion of Ukraine coupled with the consequences of the war on global supply chains have resulted in rapid deterioration of the global situation, which in turn has forced EUROFER to lower its outlook on steel consuming industries and sectors. It foresees 2% growth in output in 2022, followed by a modest 2.3% growth in 2023.
The level of high uncertainty is set to last at least until the end of the current year, said EUROFER.
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