On October 14, the World Steel Association released global short-term steel demand forecasts for 2019-2020. It is predicted that global steel demand is expected to reach 1.775 billion tons in 2019, an increase of 3.9% year-on-year; global steel demand is expected to reach 1,805.7 million tons in 2020, an increase of 1.7%.

“Global steel demand will continue to grow beyond expectations in 2019, with major growth coming from China; steel demand in other parts of the world has slowed, mainly due to economic uncertainty, trade tensions, and geopolitical risks. The impact on investment and trade,” said Al Remeithi, chairman of the World Steel Association’s Market Research Committee. “In 2019, China’s steel demand is expected to grow by 7.8% to 900.1 million tons; steel demand in the rest of the world is expected to increase by 0.2%. , reaching 874.9 million tons. China's steel demand is expected to grow by 1.0% in 2020, and steel demand in the rest of the world is expected to increase by 2.5%. Although the global economic outlook remains highly uncertain in the future, it is expected to be in emerging economies in 2020. Driven by rising steel demand in developing economies (except China), global steel demand is expected to continue to grow."

China's steel demand is expected to grow by 7.8% in 2019

Although China's economy continues to slow down, it is expected that China's steel demand will continue to grow by 7.8% in 2019, mainly benefiting from the growth of real estate investment. In the first seven months of 2019, China’s real estate market has grown significantly compared to the same period in the past five years, mainly due to the relaxation of real estate regulation and control policies in China’s second- and fourth-tier cities, and the construction that was implemented in April 2019. The pulling effect of the Unified Standard for Structural Reliability Design. It is estimated that the implementation of the new standard will increase the steel usage of the new building by approximately 5.0%. However, it is expected that by 2020, the growth rate of China's real estate investment will slow down.

In contrast, China's manufacturing industry is affected by the economic slowdown and trade tensions, and the downward trend is obvious. It is reported that China's automobile production has declined for 13 consecutive months. The Chinese government may introduce tax measures to boost the sales of passenger cars, especially the sales of new energy vehicles. It is expected that China's auto market will recover in 2020, and China's steel demand is expected to increase by 1.0%. China's machinery and equipment output growth has slowed down. Although the replacement demand for machinery and equipment is expected to provide support for 2019 and 2020, China's machinery and equipment manufacturing industry is expected to decline by 1.0% in 2019.

As the unresolved trade tension continues to exert pressure, the World Steel Association expects that the Chinese economy will continue to decline in the second half of 2019 and 2020. The Chinese government is unlikely to introduce a large-scale stimulus policy again, because it will break the balance between the economic slowdown and the current process of China's economic restructuring. The Chinese government may introduce some moderate stimulus policies that will focus on infrastructure construction and tax cuts to increase consumer purchasing power.