EU Steel Consumption Predicted to Increase in 2024

The European Steel Association (Eurofer) reported that the consumption of steel within the European Union will rise by 5.4% in 2024. This figure is depend on the developments of industries. However, there is high uncertainty in the overall evolution of steel demands, and the consumption of steel points to drop 1% in 2023. Either way, the steel price face the impact from this potential increase.

Energy prices remain high in EU slowing the demand of steel. Since February 2022, the conflict between Russia and Ukraine emerged, about 40% of the gas supply has been cut off. Currently, the gas price was down €27.97 ($29.89) per megawatt hour on the afternoon of June 5. The warmer fall and winter also help the price decline. Even so, the latest price is much higher than €5.71 ($6.11) on the same date in 2020.

Hot rolled coil steel prices in Europe are less competitive than the imported product from Asia. A report shows the price almost drop 27.2% year-on-year, but the Asian import offers continue to push it down. Despite the positive voice from the Eurofer, a number of analysts indicate that European steel consumption is facing a lot of pressure in the rest of 2023 with the combination of high energy prices, low demand and economic uncertainty.

“Despite these challenging conditions, steel-using sectors’ output grew (+3.1%) also in 2022 after the post-COVID rebound (+6.7%) in 2021,” the association mentioned. The growth expected to slow down in the rest of 2023.