Fitch Foresees Dip in Global Steel Prices in 2022 on Subdued Chinese Demand

SEATTLE (Scrap Monster): Fitch Solutions released new report outlining its global steel price outlook for the current year. The steel prices are likely to fall in 2022 on subdued Chinese demand, said the report.

According to Fitch Solutions, the world prices are expected to drop to $750 per ton during the year, from the current average of $950 per ton. Also, the prices will ultimately drop to $535 per ton over 2023-’25.

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It must be noted that the financial services company had predicted a price drop for H2 2021. In line with the forecast, the prices had started to cool off in the second half of the previous year. The prices in the European and Asian regions had declined throughout the second half of 2021. Meantime, the U.S. steel prices had started to stabilize starting October last year, following a rally which commenced in Q4 2020.

The slowdown in Chinese domestic steel demand coupled with rising market protectionism are likely to loosen the market and drag prices lower in the medium term. The Chinese demand is projected to witness significant fall in the forthcoming decade, compared with the previous one. Meantime, ongoing projects and new public infrastructure schemes will continue to boost steel demand over 2022-’25, Fitch Solutions said.

However, Fitch maintained upbeat outlook on projected steel demand in the U.S. and Europe.