The World Steel Association (WSA) has released its Short-Range Outlook for global steel demand in which it predicts demand will bottom out in 2025 and show moderate growth next year. Specifically, the Outlook expects worldwide steel demand to reach 1,750 million metric tonnes (Mm/t) this year, followed by a rebound of 1.3% in 2026, pushing it to 1,772 Mm/t. The WSA represents global steel producers, national and regional steel industry associations, and steel research institutes. Its members account for 85% of global steel production. Despite its optimism for 2026, the WSA admits that escalating trade tensions are having a direct and negative impact on steel demand in economies heavily reliant on the export of steel-intensive goods, such as machinery and automotive components. Also, geopolitical uncertainties are cooling both consumer and investor confidence, and dampening steel demand across key markets. The Outlook identifies demand on a region-by-region basis. During 2025, steel demand in the United States is expected to rebound by 1.8% thanks to the front-loading of production ahead of President Trump´s tariffs and continued growth in infrastructure spending. In 2026, steel demand is predicted

to grow by 1.8%, aided by pent-up demand in residential construction. With regards to China, the chair of the WSA´s Economics Committee, Alfonso Hidalgo de Calcerrada, said: “We anticipate China’s steel demand will continue its decline in 2025, falling by approximately 2.0% and driven primarily by the ongoing downturn in the housing market. Looking ahead to 2026, the decline is projected to decelerate to 1.0% as the housing market bottoms out”.

The Outlook forecasts demand in the EU + UK region to grow by 1.3% in 2025 and 3.2% in 2026. The return to steel demand growth in the EU reflects the impact of increased infrastructure and defence spending on the continent and lower inflation. However, in the developed world as a whole, the WSA predicts a 0.5% decrease in steel demand in 2025, marking the fourth consecutive year of decline. A recovery is anticipated in 2026, with projected growth of 1.5%.

Steel demand in the developing world (excluding China) is projected to enjoy solid growth, with a 3.4% increase in 2025 and a 4.7% increase in 2026. This expansion will be primarily driven by strong performances in India and some ASEAN and MENA countries. The WSA believes steel demand in India will continue to charge ahead with around 9% growth over 2025 and 2026. The Outlook states that improving macroeconomic fundamentals and governance in Africa will prompt a 5.5% increase in steel demand this year. The same increase is expected during 2025 in the Central and South America region.

To other matters, in the September 18 issue of Australian Steel News we highlighted the problems that exorbitant gas prices are causing in the steel industry on Australia´s east coast. In an address to the National Press Club earlier this month, Mark Vassella, the CEO and MD of BlueScope Steel, put it bluntly. “Australian manufacturing is at a dangerous crossroad,” he said. “Major change is required to fix our broken gas market and reinstate a fair domestic price. If we can’t, we face a decline in manufacturing, similar to that which we’ve seen in the UK steel industry.” Natural gas is used in the steel industry primarily in `process heating´. This generally means: heating and drying of refractory lining materials used in ironmaking and steelmaking processes; heating of steel prior to hot rolling and coating processes; and heating of semi-finished steel products during heat treatment processes.

BlueScope Steel is a member of Manufacturing Australia (MA), a coalition of Australia’s largest manufacturers. Other members include Sims Limited, Tomago Aluminium, Brickworks, and Capral Aluminium. MA is urging the federal government to adopt an east coast gas reservation policy and a $10-a-gigajoule price cap to guarantee an affordable supply of gas to domestic manufacturers. The government presently has a $12 per gigajoule wholesale gas cap. However, MA says some manufacturers are currently facing contract offers of up to $20 a gigajoule and that more than 1400 manufacturing firms in Australia have collapsed since 2022-23, with energy prices partly to blame.

Capral Aluminium is among those feeling the strain. Chief executive, Tony Dragicevich, told ABC News that high gas prices were causing pain across the supply chain. He said gas now made up about 7% of Capral’s manufacturing costs. “Five years ago, we were paying about $5 to $6 a gigajoule. We’re now paying around $15. We cannot get a gas contract anywhere near $12,” Mr Dragicevich said.

Mr Vassella told the Press Club audience: “Despite our massive gas reserves, Australia has one of the highest wholesale gas prices among producer nations in the world. And worse, the adoption of a pricing mechanism based on LNG export prices means local gas users are effectively paying for export infrastructure they don’t use”.

Ben Eade is the CEO of Manufacturing Australia. He told the ABC: “Gas prices start from $12 and move up from there. Production is up, demand is down, but prices have tripled. If that doesn’t speak to a broken market, I don’t know what does”. MA says reserving just one third of current east coast production would be enough to meet domestic manufacturing and residential needs, while still allowing most gas to be exported. “It shouldn’t be controversial to say that in a country like Australia – which is awash with gas – we should be able to supply domestic customers first, while still maintaining a thriving and globally significant export industry,” Mr Eade said.

Mr Vassella concluded his Press Club address by referencing the federal government´s Future Made in Australia policy initiative. “A future made in Australia depends on affordable gas being made available for Australian industry,” he said. “No gas, no Future Made in Australia”.