The current economic outlook of the world steel association worldsteel predicts a rise of 1.8 percent in the global steel market volume for this year. Across the entire European Union, however, a decline of 5.1 percent is expected. Germany will be especially affected by this downward development, as the market volume is expected to shrink by 10 percent, after a decline of 9 percent in the previous year. Although worldsteel expects a rise of 1.9 percent in the global steel demand in the coming year, the situation of the German economy will remain challenging next year as well.
The current statistic of the German Steel Association regarding the production of raw steel in Germany gives weight to this tendency. From January to September, the amount of electrical steel decreased by 12 percent compared to the same period of the previous year. This shows how much the electricity-intensive production of electrical steel, which is already comparatively low on carbon emissions, suffers from the continuing high cost of electricity.
Kerstin Maria Rippel, chief managing director of the German Steel Association, comments:
“The demand for steel in the EU continues to decrease, and Germany is at the absolute bottom of the line. Combined with the cost of energy which has been unable to compete internationally over several months, this development is toxic. The already challenging local conditions for steel production in Germany are becoming even more difficult, and the electrical steel companies above all, which are already capable of producing steel at comparatively climate-friendly conditions, are forced to shorten work-hours and can only fire up their furnaces at night or during the weekends. We need political decisions that focus on relief for our electricity-intensive industry immediately! The reason is that especially the steel industry not only plays a key role for decarbonising our country, it is also the foundation of our current and future economic wealth!”
Dr. Martin Theuringer, chief national economist & managing director of the German Steel Association, adds:
“In the global economic perspective just published by worldsteel, Germany inhabits a worrisome special place: The decrease this year is higher than in the rest of the EU, due to high energy prices and rising interest rates, and is in contrast to the comparatively stable development of demand in other regions outside of Europe. Added to this is the strain accumulated during previous years, especially during the Covid-19 crisis. Since 2017, the German steel market has lost approx. 30 percent of its volume in tonnes. With a market supply of probably around 29 million tonnes, the 30-million-tonne limit will be undershot for the first time since 2009. And in the coming year, too, the demand for steel remains at a low level with a volume of approx. 32 million tonnes.”