The agency initially anticipated the steel price to average $920/t this year.
Fitch Solutions explains that its lower steel price forecast for next year is owing to the price rally globally coming to an end, but says US prices will still see some upside in coming months once President Joe Biden’s Infrastructure Bill comes into effect.
However, the agency points out that Chinese steel demand from the construction industry will continue to weaken over 2022 to 2025 as project pipelines taper down and risks mount on the country’s property sector, bringing down the global average along with European prices.
The outlook for steel demand in the US is more upbeat, with policy poised to bolster building materials demand, including steel, while Europe should also record an increase in demand following a collapse in demand in 2020.
The agency adds that global steel prices will remain on a downward trend, particularly as the market is seeing a paradigm shift to ‘green’ steel, at the expense of traditional steel produced with a blast furnace.
