Ongoing disputes over trade, notably with the USA at the centre, have been a focus of attention over the last year. These may not significantly change the overall volume or direction of trade however, according to worldsteel executives at its annual gathering in Tokyo Tuesday. Key areas of demand growth are meanwhile important in ensuring other markets are not flooded by exports from some countries, Kallanish notes.

“We believe in markets that are as free as they can be within a rules-based system like the WTO,” says worldsteel president Edwin Basson. He would not be drawn on the future direction of trade policies, but notes that sometimes we imagine the world is darker than it is.

The total proportion of steel traded across borders has historically been around one third of total production, and this remains the case, with trade at around 32%, Basson says. Historically, trade frictions such as those in the early 1990s do not have a significant impact on volumes even when there is an impact on prices, despite all the questions they engender, he adds.

For Japan in particular meanwhile, the impact of trade frictions is expected to be small, according to Kosei Shindo, president of Nippon Steel and Sumitomo Metal Corporation (Nippon Steel). Only around 2% of Japan’s output is exported to the US, and it account for only around 5% of US imports. The impact of trade frictions globally has also been minimised thanks to the pace of global economic growth, he notes.

For the western world, in addition to the state of the major exporting nations, the strength of economies in Southeast Asia and the Middle East is crucial, Basson says. Luckily, Southeast Asia is seeing strong demand growth in the near term. The region is set amidst major exporters China, Japan and Korea and soaks up significant volumes from these countries. The Middle East also remains a major steel importer despite the growth in capacity there.