Page 42 - Steel Tech India eMagazine Volume April 2022

VOL. 16 • NO. 3 • April 2022

the capital goods sector. are expected to face challenges in maintaining their
economic momentum. In particular, Brazil’s steel
however, the war in Ukraine poses a renewed risk of
supply disruption and inflation, which may impact the demand is expected to contract by 8.5% in 2022. A
central bank’s accommodative stance and consumer moderate recovery is expected for the region in 2023.
sentiment. the current war between Russia and Ukraine makes
Steel demand in ASEAN has been slow to recover it difficult to provide any credible projections for these
from the pandemic due to continued disruptions to countries. A major decline of steel demand in both
construction activities and a slow recovery in tourism. countries is penciled in under the assumption that
Supply bottlenecks further contributed to slower than military actions will end in the course of 2022 and
expected recovery of manufacturing. however, a reconstruction activities will start in Ukraine in 2023.
stronger recovery momentum has been visible since the sanctions on Russia are expected to be sustained.
Q3 2021. cOVID cases remain high as of Q1 2022, Steel using sectors
especially in Vietnam. Still, countries are gradually
opening up, and a visible recovery in construction Construction
projects is expected in 2022, allowing a return to a In 2021, global construction activity continued to
more normal growth track. recover from the lockdowns, to record 3.4% growth
despite a contraction in china. the recovery was driven
Turkish steel demand showed double-digit growth
during the pandemic and the following year. however, by an infrastructure push as part of most recovery
an unorthodox monetary policy has led to another round programmes.
of currency depreciation and deteriorating economic Strong infrastructure initiatives in many countries and
performance in 2022. the government’s measures to investments related to the energy transition will likely
support construction and supply chain normalisation drive the construction sector’s growth for years to
will allow moderate steel demand growth in 2022 and come. however, the construction sector is facing some
2023. With its relatively high dependence on Russia for headwinds. like other sectors, the global construction
inputs and raw materials, the RussiaUkraine conflict sector is experiencing supply-side problems, leading to
has significant downside risks for turkey through increased construction costs. Also, the move of central
inflation and currency volatility. banks to raise interest rates to fight inflation may play

While the recovery in steel demand in the Gcc a negative role in the growth of construction activity in
countries lagged behind other regions in 2021, Gcc 2022-23.
steel demand will accelerate with the resumption of the residential sector was performing well due to
construction projects that will be further boosted by low interest rates and the expansion of working from
lessening budget pressures and easing of cOVID-19 home practices. Accelerated inflation is forcing buyers
related restrictions. the UAe is likely to lead the to rush into property markets, using them as a hedge.
recovery, while Saudi’s continued effort for economic however, rising housing prices might undermine future
diversification is expected to drive steel demand growth housing affordability for some social groups. In the non-
in the Gcc region in the coming years. residential sector, while office buildings suffered from
After a year of solid rebound from the pandemic in 2021, remote working practices, e-commerce and It-related
Latin America is facing a challenging environment investments supported the sector.
in 2022. Steel demand surged by 26.6% in 2021, On a regional basis, there is strong growth in the multi-
following a contraction of 8.8% in 2020, led by Brazil. unit segment in the US. Also, infrastructure investment
however, in 2022, the latin American economy faces will get some positive momentum driven by the
challenges from rising inflation, uncertainty related to infrastructure bill of 2021. Recovery in energy-related
elections, and social tensions in some countries. the investments is also expected to boost construction
war in Ukraine and the US monetary tightening will add activities in the US.
further pressure to these challenges. the region’s steel
demand is expected to contract in 2022, as Brazil and In china, with government policies in place to tame
Mexico, the region’s two largest steel using countries, the real estate sector bubble, infrastructure will be the

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