Infrastructure spending, decarbonization efforts to drive global steel market outlook

Infrastructure spending, demand from green-intensified factors and a global reduction in carbon emissions are expected to bolster global and North American steel markets, presenters said at the Global Steel Dynamics Forum, held June 27 in New York.

"We believe the North American market is about to hit a once-in-a-century growth spurt resulting from a combination of factors," Philipp Englin, CEO of World Steel Dynamics said, pointing to increased infrastructure spending, demand from the "greenification" of the energy grid, upside in automotive activity, manufacturing reshoring and further reductions in imports.

In the near term, Englin said WSD expected a downturn on exported hot-rolled coil prices for the remainder of the summer and into late third quarter. The decline in export prices would be precipitated by steel demand in China despite stimulus measures that would not likely have an effect until early next year, Englin added.

In addition, WSD forecasted a decline in prices of iron ore and coking coal, Englin said.

Despite an expected decline in global economic conditions outside of China, Englin said WSD expected a major recession to be avoided "especially in the US," and that global HRC prices could rebound sometime in Q4.

Managing Partner of WSD, John Lichtenstein, shared the company's outlook on global steel industry decarbonization.

"We think that global emissions [in] industry as a whole is going to decline 13% between 2019 and 2030," Lichtenstein said. He expected a significant drop in Chinese production combined with an increase in the share of electric arc furnace production, leaving approximately 180 million st of blast furnace steel "to become redundant in that period."

Specifically, Lichtenstein said the US-Mexico-Canada region is poised "for a significant growth and further advancement of comparative advantage of emissions largely attributable to the EAF [production]."

Nucor sees growing demand from low-emissions steel, energy transition

Nucor CEO Leon Topalian said low-emissions steel products were "the fastest moving part of our industry today."

Original equipment manufacturers and automotive industry participants were "demanding a cleaner product," Topalian said.

When asked about end-markets the company wished to reach at Nucor's Brandeburg, Kentucky, plate mill facility, which began operations earlier this year, Topalian said the facility was ideally positioned as it would be the only plate mill "capable in the western hemisphere making the monopile sections for offshore wind." Topalian expected the facility to be profitable by the end of 2023.

Topalian said he expected to expand in manufacturing of downstream products through their new sheet mill in Mason County, West Virginia, rebar mill in Lexington, North Carolina, as well as a new melt shop in Kingman, Arizona.

In addition, the CEO pointed to the company's Louisiana direct-reduced iron facility as another component of their "many-pronged strategy to lower their overall embodied carbon for customers."

When asked about Nucor's plans to expand on steel products for the automotive sector, Topalian said the company was taking a deliberate approach to partnering with OEMs, which would in turn help them reach their sustainability targets.

"Our ultimate goals are to double our reach into the automotive sector from where we are at today," Topalian said.