Bearish Outlook for the global Steel Market: Prices Hold Steady, but a Rebound Seems Unlikely
The global steel market has been impacted by several macroeconomic factors this week, significantly reducing the likelihood of any near-term price recovery. With oil prices dipping below $60 per barrel and OPEC maintaining plans to increase production, analysts see little evidence of upward momentum in the steel market.
Recent data indicates that billet prices have stabilized, with a slight $10 decrease, suggesting they may have bottomed out. This aligns with the World Bank’s projection of a 12% decline in global commodity prices this year, followed by an additional 6% drop next year.
Furthermore, oil prices are projected to remain below $60 per barrel through the end of 2026, placing continued downward pressure on industrial markets, including steel. Consequently, industry experts argue that expectations for price increases under current conditions are unrealistic, and maintaining price stability appears to be the most optimistic scenario.
China's economic growth, constrained by U.S. trade tariffs, is forecasted to slow to around 3%. This weaker outlook may further suppress global steel demand. Observers caution that billet prices in China must remain above $400 per ton (ex-works), as any further decline could exacerbate market instability.
Amid ongoing global economic stagnation and uncertainty, analysts believe the current sluggish conditions in the steel market are likely to persist. Only a notable recovery in global economic fundamentals could pave the way for a sustained price rebound.
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