Iron and Steel Overview: Market Drivers

market_drivers

Courtesy of Gas Research Institute Digest.

The strong economy created a boom in demand for steel in the automotive, construction, and machinery sectors during the 1994. Though the cyclical nature og steel demand is unlikely to be broken, several negative trends that lowered steel demand over the last twenty years aer reversing, such as: revival of the U.S. marketing sector, increased capital spending, growing need for infrastructure renewal, increase in the size of automobiles demanded, slowdown in the rate of substitution of plastics and aluminum for steel, a limit to the lightening/strengthening of steels that has occured, and a similar limit to the material efficiency gains achieved by computer aided design and manufacturing. Exclusive of cyclical swings, steel production is forecast to grow at a modest one-half percent per year over the next 15 years.

The automobile and appliance industries are creating a demand for new products that are lighter, stronger, more uniform in their characteristics, and more resistant to corrosion. These demands are stimulating development of new refining, casting, rolling, and coating processes that provide a better product at a competitive cost. The use of steel framing in residential construction could create a significant new market for steel products.

 

Hogan, W.T., Steel in the 21st Century, Lexington Books, New York, 1994

George J. McManus, “Steel Industry is Entering a Critical Period”, Iron and Steel Engineer, July 1995