Fairly Bullish Outlook Given for North American Steel Market at Platts' Steel Conference
03/27/2014 - While there is some uncertainty about the prospects for the global steel industry this year, the outlook for the North American market is a bit rosier, according to speakers at Platts’ 10th Annual Steel Markets North America Conference, held 19–20 March 2014 in Chicago.
Timna Tanners, metals and mining analyst at Bank of America Merrill Lynch, said brighter days are ahead for U.S. steel demand, and gave conference attendees an optimistic outlook for the U.S. non-residential construction market. “We’re actually pretty excited about non-res,” she said. “2014 is finally the year of a recovery in non-res. Leading indicators suggest a gradual recovery in 2014 and more momentum heading into 2015.”
Charles Trowbridge, sales manager at Steel Dynamics Inc.’s Flat Roll Division, echoed support for a comeback in the non-res sector, noting that the American Institute of Architects (AIA) has projected 5.8% growth in the sector in 2014 followed by 8.0% growth in 2015.
On the automotive side, Mr. Trowbridge noted that the harsh winter weather definitely impacted demand in the first quarter of 2014, but he expects inventories will drop and things will look a lot better in the sector by the summertime. Addressing the lightweighting trends in the automotive market and steels’ seemingly uphill battle, he said, “Steel is not dead in transportation by any stretch.” He said steel has a tremendous environmental advantage versus aluminum and other alternative materials, and ongoing research should continue to help steel.
Conrad Winkler, president and CEO of EVRAZ North America, noted during the Executive Views panel that the rail business in North America is fundamentally strong and stable. He does expect to see stronger growth in rail car manufacturing.
EVRAZ North America is also bullish on natural gas and oil production in North America, and is focused on what’s happening in the western region, which is one of the main regions the company serves. Mr. Winkler said a coming boom in the sector in western Canada could be really exciting, but depends on the approval of pipelines and LNG terminals. “While we don’t know exactly when it’s going to happen, we’re getting ready,” he said. He said 1.7 million tons of line pipe will be required for LNG pipelines in western Canada and 1.5 million tons will be needed on the oil side. This is “exciting stuff,” he said, and the economic impact on the region will be “unbelievable.”
A more bearish outlook was provided for the global steel industry by Adam Green of World Steel Dynamics (WSD). He said WSD increasingly pessimistic for steel demand prospects this year, noting that fixed asset investment will “not be favorable for 2014 and probably not 2015 either.” WSD predicts there is a 55% chance that 2014 will be a year of “bad times” for the global steel industry, and a 20% that there will be “shake out times” in the industry, with slow growth in China cited as one of the main drivers.
This article was written by Laura Miller, AIST industry news editor.
Charles Trowbridge, sales manager at Steel Dynamics Inc.’s Flat Roll Division, echoed support for a comeback in the non-res sector, noting that the American Institute of Architects (AIA) has projected 5.8% growth in the sector in 2014 followed by 8.0% growth in 2015.
On the automotive side, Mr. Trowbridge noted that the harsh winter weather definitely impacted demand in the first quarter of 2014, but he expects inventories will drop and things will look a lot better in the sector by the summertime. Addressing the lightweighting trends in the automotive market and steels’ seemingly uphill battle, he said, “Steel is not dead in transportation by any stretch.” He said steel has a tremendous environmental advantage versus aluminum and other alternative materials, and ongoing research should continue to help steel.
Conrad Winkler, president and CEO of EVRAZ North America, noted during the Executive Views panel that the rail business in North America is fundamentally strong and stable. He does expect to see stronger growth in rail car manufacturing.
EVRAZ North America is also bullish on natural gas and oil production in North America, and is focused on what’s happening in the western region, which is one of the main regions the company serves. Mr. Winkler said a coming boom in the sector in western Canada could be really exciting, but depends on the approval of pipelines and LNG terminals. “While we don’t know exactly when it’s going to happen, we’re getting ready,” he said. He said 1.7 million tons of line pipe will be required for LNG pipelines in western Canada and 1.5 million tons will be needed on the oil side. This is “exciting stuff,” he said, and the economic impact on the region will be “unbelievable.”
A more bearish outlook was provided for the global steel industry by Adam Green of World Steel Dynamics (WSD). He said WSD increasingly pessimistic for steel demand prospects this year, noting that fixed asset investment will “not be favorable for 2014 and probably not 2015 either.” WSD predicts there is a 55% chance that 2014 will be a year of “bad times” for the global steel industry, and a 20% that there will be “shake out times” in the industry, with slow growth in China cited as one of the main drivers.
This article was written by Laura Miller, AIST industry news editor.
