Forecast of domestic and foreign steel market in 2024

In recent years, the world's economic and political situation has always been tense. As for Vietnam, there is a positive sign when the economy is gradually recovering and developing after experiencing the pandemic, but is still affected by the world situation. Therefore, it is predicted that the domestic and world industrial steel markets will have many fluctuations.

Forecasting the world steel market when the Ukraine and Russia War is taking place
Since the Covid pandemic passed, the world has always gone through many difficult periods when economic activities were stagnant due to the impact of the Covid 19 epidemic, followed by many political fluctuations. The most alarming thing is the escalation of the conflict leading to the war between Russia and Ukraine.

In early 2022, when the war between Russia and Ukraine officially began, it brought about a series of serious impacts on the stainless steel manufacturing industry. The beginning was the situation where steel products such as quality stainless steel pipes, stainless steel materials, or household accessories began to increase in price. The main reason is that both Russia and Ukraine are two suppliers of coal (raw materials for the steel industry) and are also major steel producers and exporters in the world. In addition, Russia is also a major supplier of nickel and aluminum to the world.

When sanctions and embargoes are imposed on Russia, it will lead to an imbalance in supply and demand for the stainless steel market, thereby pushing up steel prices. Especially in the European market, the shortage of steel products is even more serious. This can also be considered a challenge as well as an opportunity for other steel export markets, including Vietnam.

Domestic steel market forecast 2024
Entering 2024, many experts predict that Vietnam's steel market will have many new positive steps compared to 2023. Mr. Dinh Quoc Thai, General Secretary of VSA, said that steel consumption will increase by 7% to 21.7 million tons. Output could reach nearly 29 million tons, an increase of 7% compared to 2023. One of the main reasons is thanks to projects being implemented and accelerated such as the North-South expressway project, Long Thanh airport project, etc.

Another encouraging sign for the Vietnamese steel industry is that the real estate market is expected to recover in 2024. Based on CBRE's report, apartment supply is expected to improve from 2024. Of which, apartment supply in Hanoi is expected to increase by more than 33% in 2024, reaching 20,000 apartments and in Ho Chi Minh City. Ho Chi Minh City supply reached about 12,000 units (up 31%).

As for the export market, the EU and US markets have shown signs of recovery, which has contributed to affecting the output of exported steel products. Export steel prices are expected to increase by 9% in 2024, helping to improve the gross profit margin of steel exporting enterprises.

Mr. Pham Quang Anh, Director of the Information Center of the Vietnam Commodity Exchange (MXV), said that the Government will continue to make efforts to accelerate the disbursement of public investment in 2023 to promote breakthrough growth.

Prospects for recovery of the world steel market in 2024

Despite the ongoing political tension and tightening monetary policies, the world steel market in 2024 is still expected to recover and make expected progress.

According to the forecast of the World Steel Association (WSA), by 2024, world demand is expected to recover by 1.9% compared to 2023 to 1.8 billion tons, when the EU and Indian markets recover by 5.6% and 7.5% respectively over the same period.

India leads with outstanding steel consumption growth despite pressure from high interest rates. Government policies to promote investment in infrastructure construction have contributed significantly to growth in the construction industry. Not stopping there, steel consumption in the automobile and consumer goods sectors also contributes a large part. India's steel consumption is expected to increase by 7.7% (135.8 million tons) in 2024.

As for the Middle East and North Africa, steel consumption is expected to decline in 2023 with a negative growth of 3.5% and recover in 2024 due to the promotion of many infrastructure and housing projects that have stalled in previous years.

Steel demand in Latin America is expected to increase by 2.1% in 2024. The main reason is that issues related to rising interest rates and inflation are no longer so common in this region as some countries have begun to loosen monetary policies.

2024 is the most anticipated year because this is the year when the world economy is predicted to gradually recover after a "trough". After considering many aspects and studying the data, we can see a lot of hope for the Vietnamese steel industry.