According to the Economic and Steel Market Outlook 2023-2024/Q4 2023 Report from the Economic Committee of the European Steel Association (EUROFER), in 2023 the steel market outlook has been bleak due to decreasing demand resulting from high inflation and interest rates, exacerbated by conflicts and perpetually high energy prices. The decrease in apparent steel consumption is expected to gain traction this year, with a 5.2 percent drop foreseen, and the anticipated rebound of 7.6 percent next year faces geopolitical unpredictability and prolonged economic uncertainty. In the second quarter of 2023, apparent steel consumption in the EU-27 amounted to 35.6 million mt, decreasing by 7.6 percent compared to the same period of 2022. Although this volume was higher than in the previous quarter, it was still below the levels recorded in 2021 and in the first half of 2022.
According to the association, apparent steel consumption is expected to decrease by 5.2 percent in 2023, compared to the previous forecast of a three percent decrease. In 2024, a 7.6 percent increase is anticipated for apparent steel consumption. However, this recovery is conditional on still very uncertain positive developments in the industrial outlook and steel demand.
Despite this challenging backdrop, steel-using sectors in the EU showed unexpected resilience and grew by 0.8 percent in the second quarter, with the help of the positive performance of the automotive, mechanical engineering and transport sectors, offsetting poor output in domestic appliances, tubes and metalware, along with the ongoing recession in construction, which accounts for 35 percent of steel consumption. Steel-using sectors are expected to grow by 0.6 percent in 2023 compared to the previous estimate of 1.3 percent and by 0.4 percent in 2024 due to a potential downturn in the automotive sector.
Domestic deliveries in the EU decreased by 6.5 percent in the second quarter of 2023.