2024. A year when hopes were dashed – expectations unmet. After tough business conditions in 2023, characterised by escalating geopolitical tension and inflation, the green shoots which some commentators foresaw blossoming in the spring remained buried firmly under soil. 

One forecast that did materialise, emphatically, was for an escalation in trade cases. Chinese steel exports continued to grow in 2024 and are expected to reach their highest level since surpassing 112 million tonnes in 2015. This came as Chinese domestic demand continued to slow amid persistent construction sector woes, thereby absorbing less steel. Chinese production is on course to decline in 2024, but only slightly. The swathe of trade cases initiated during the year were mainly against Chinese steel, but famously in the EU’s case, the crackdown was directed at other Asian origins, whose steel supply was displaced by Chinese tonnages.

While the market had become accustomed to sluggish construction sector demand, robust automotive industry performance the previous year had gone some way to masking problems in the manufacturing sector. But these came to the fore in 2024 and, coupled with high interest rates and tense geopolitics, resulted in steel demand forecasts being lowered throughout the year. In its latest outlook provided in October, worldsteel said global demand would inch down 0.9% on-year in 2024. Eurofer meanwhile went from forecasting 5.6% EU demand growth in 2024 at the start of the year, to expecting a 1.8% decline in its October outlook.

2024 was a year of failed Chinese economic stimulus promises. On numerous occasions, the global industry waited for a tangible impact on Chinese domestic demand from an array of stimulus policy announcements. On almost all of these occasions, Chinese prices spiked due to speculation, only to fall immediately back again when it became clear demand would not be supported. In August, Chinese HRC and rebar prices hit over seven-year lows. The last round of stimulus policies, announced in December, has the market hoping for demand improvement in 2025. Watch this space.

European industry continued to battle with declining economic output, rising costs and, some would say, an overambitious climate policy. “Decarbonisation without deindustrialisation” became the rallying cry of EU steelmakers, who pushed for a holistic industrial plan that benefits the union as a whole. Former ECB President Mario Draghi warned Europe would face “slow agony” if it did not implement measures to raise competitiveness in the face of competition from China and the US. Europe is already well-schooled in the trade measures game, with long-standing safeguards being tightened in the past year and CBAM tests continuing. But it became clear in 2024 that such measures alone would not be enough to revive local industry’s fortunes.

2024 was the year when the UK’s Port Talbot steelworks ended ironmaking for good. It was the year ArcelorMittal relinquished control of the iconic Taranto steelworks to the Italian government, and long-troubled steelmaker Celsa finally divested production assets. Thyssenkrupp’s management quite en masse and the group announced plans to axe 11,000 jobs. It was also the year the US’s relationship with Japan was questioned as Nippon Steel’s proposed acquisition of US Steel came up against strong political opposition.

While decarbonisation floundered in Europe, prospects for renewable energy and green metallics investments in other regions, such as Brazil, the Middle East and North Africa, and Australia, became more promising. The development of green metallics corridors will be a topic to watch going forward.

As we enter 2025, uncertainty continues to cloud the market outlook. What is certain is that lower interest rates should support a demand rebound in mature economies, but probably not until the second half of the year. The return of Donald Trump as US President is likely to mean further restrictions to global trade but also greater unpredictability. His inflationary policies may derail the US’s inflation reduction. The new European Commission is likely to take a leaf out of Trump’s book and put “Europe first”, meaning introduce measures to ensure local suppliers benefit from any demand rebound facilitated by a new EU industrial strategy. While continuing decarbonisation, Europe is also likely to focus more on defence and security concerns, which could also stimulate steel demand.

Amid an increasing number of trade measures against Chinese steel, exporters in the country will need to find new homes for their product. Economic growth will continue slowing in China, with steel demand depending on how the country tackles its property sector crisis.

Whatever happens in 2025, Kallanish will be here to bring you all the key developments as they happen. Thank you for your support and see you in the new year!