Fitch Ratings in a recent report opined that Chinese steel production will register a low single-digit decline in 2022, remaining above 1 billion tonnes, as slowing property sector demand will be partly offset by higher infrastructure spending and manufacturing. Fitch said “The demand rebound in the rest of the world in 2021 was stronger than anticipated, with estimated output of 870 million tonnes in 2021, exceeding pre-pandemic levels a year earlier than expected. This was thanks to pent-up demand and stimulus measures, including the EUR 750 billion EU recovery fund and the recent USD 550 billion US infrastructure bill, with strong support for the energy transition.” Fitch said “Since the global recovery lags that of China, GDP growth in China is already cooling to a more normal rate of 4.8% for 2022, while other countries are still seeing above-trend growth.” The rating agency has identified the evolution of economic and environmental policies in China, and their impact on the steel industry as one of the main factors to watch. Also to look out for will be government stimulus across regions and the strength of recovery in key end-markets, and resolution of supply-chain bottlenecks, as well as evolution of protective trade measures in the US and EU. Moreover, policy commitments and support for steel decarbonisation by major economies will be crucial.
Fitch Ratings in a recent report opined that Chinese steel production will register a low single-digit decline in 2022, remaining above 1 billion tonnes, as slowing property sector demand will be partly offset by higher infrastructure spending and manufacturing. Fitch said “The demand rebound in the rest of the world in 2021 was stronger than anticipated, with estimated output of 870 million tonnes in 2021, exceeding pre-pandemic levels a year earlier than expected. This was thanks to pent-up demand and stimulus measures, including the EUR 750 billion EU recovery fund and the recent USD 550 billion US infrastructure bill, with strong support for the energy transition.” Fitch said “Since the global recovery lags that of China, GDP growth in China is already cooling to a more normal rate of 4.8% for 2022, while other countries are still seeing above-trend growth.” The rating agency has identified the evolution of economic and environmental policies in China, and their impact on the steel industry as one of the main factors to watch. Also to look out for will be government stimulus across regions and the strength of recovery in key end-markets, and resolution of supply-chain bottlenecks, as well as evolution of protective trade measures in the US and EU. Moreover, policy commitments and support for steel decarbonisation by major economies will be crucial.
