With an increase in demand for products from various sectors, the manufacturing industry is making strides worldwide. All the equipment used in the manufacturing industry contains iron or steel in some amount, while some are completely made of them. The increasing demand for manufacturing is driving the sustainable development of industries, and it is leading to a demand influx for iron and steel in the end-user industries as they are progressing in terms of production. The automotive industry, which is booming with a humongous amount of vehicles manufactured annually, is also expected to further propel the Iron and Steel Market. The building and construction industry is creating a favorable pricing environment for the iron & steel market players. Additionally, the construction industry is only going to expand further because there is a significant infrastructure investment gap which will increase construction projects worldwide. In recent years, the electrical industry has emerged as one of the major consumers of iron and steel, and growth of the industry will create notable opportunities in the iron & steel market which was already valued at $1.8 billion in 2018. Moreover, the iron & steel market is poised to grow at a CAGR of 5.1% during the forecast period 2019-2025.                                                                                                                    

This market growth can be further fathomed by the globally increasing trade of iron and steel. According to the International Trade Centre (ITC), the trade value of iron and steel was evaluated to be $428.6m in 2018. While the trade witnessed the growth of only 2% between 2014 and 2018; 2017-2018 witnessed a noticeable increase in demand of 13%. This growth in the trade of iron and steel is due to the demand influx from various end-use industries, which is creating significant opportunities for vendors in the steel market.    

Booming Iron & Steel Market in APAC and the Future for Vendors –

In 2018, APAC held the maximum share of 50% in the iron and steel market. The growing steel market in APAC is attributable to the growth of the construction industry in China, India, Indonesia, and Japan. Another factor driving the iron and steel market is the Chinese automotive industry which is the largest automotive industry in the world. Furthermore, the booming manufacturing and electrical industries in China and India created lucrative opportunities for the vendors in the APAC iron & steel market during 2018. 

· Demand Influx from the China Construction Industry –

China’s construction industry, that had been facing a decline since 2011, witnessed slight growth in 2017. According to the World Bank, the contribution of the construction industry to China’s GDP was assessed to be 39.881% in 2016, and this figure grew minutely to become 40.456% in 2017. According to the Global Construction Perspective (GCP) – Oxford Economics, the global construction industry which is poised to attain a lucrative value of $8 trillion by 2030 will be majorly driven by China, India, and the U.S. This will create massive growth prospects for the iron market in China and in the APAC region at large.

·  China Automotive Industry to Play a Vital Part in Growth of the APAC Iron Market–

According to the International Trade Administration (ITA), China is the world’s largest automotive industry with 28 million units being manufactured in 2016. Furthermore, the Chinese Government expects the industry’s output to reach 30 million units by 2020 and 35 million by 2025. The automotive industry will play a major role in the growth of the iron and steel market in China.

Apart from the China automotive and construction industries, the electrical industry offered opportunities in the steel market. This is quite evident with the fact that APAC had the maximum electrical steel market share of 39% in 2018 wherein China had a major contribution. 

· India Construction Industry – A Profitable Iron Marketplace

According to the India Brand Equity Foundation (IBEF), the country has a requirement for infrastructure investment amounting to $777.73 billion by 2022 for sustainable development in the country. The envisioned infrastructure investment is poised to create a stir in the India iron & steel market during the forecast period. IBEF also projects the finished steel consumption in India to reach a value of 230 MT by 2030-31 from a mere 90.68 MT during 2017-2018. The anticipated investments in the construction industry will augment the iron & steel market demand in India. 

· Japan Construction Industry to Create Prospects for the APAC Iron Market –

Japan’s construction industry was more often than not considered a saturated market until the Japan earthquake in 2011. This is evident with the fact that Japan construction industry's contribution to the GDP had fallen to 26.882% in 2011 from 28.445% in 2010. However, post-earthquake the industry grew and attained the contribution of 29.144% in the GDP of 2017.  So, even though the 2011 Japan earthquake disrupted the economy, it spurred construction activities in the country. This has led to a definite demand influx in the APAC iron & steel market. Additionally, according to the Japan-based Research Institute of Construction and Economy, the reconstruction activities in the construction industry have led to investments increasing by a nominal 1.2% in 2017. The industry is poised to observe growth due to the government’s vision to revitalize the economy by focusing on infrastructural development. This growth of the construction industry in Japan has been creating opportunities in the APAC steel market. 

·  Indonesia Iron & Steel Industry Gaining Traction from the Construction Industry –

The contribution of Indonesia’s construction industry to the iron & steel market is significant. According to the World Bank, the Indonesian construction industry’s contribution to the country’s GDP is 39.387%. This booming industry is creating several growth opportunities for vendors in the APAC iron & steel market. The demand for iron and steel from the Indonesian construction industry is majorly attributable to the growing construction of offices and hotels along with gainful progress of the residential real estate or housing sector.

Iron & Steel Market: Global Scenario and Growth Drivers –

·  Growth Prospects in the Global Automotive Industry –

According to the European Automobile Manufacturers Association (ACEA), 98.1 million motor vehicles were produced globally in 2018. The upcoming years foresee a significant boom in the automotive industry because of the emergence of the electric vehicles (EVs), semi-autonomous and autonomous vehicles, and self-driving trucks. The World Steel Association (WSA) has assessed that on average, 900 kilograms of steel are used per vehicle. The increasing production of vehicles is poised to create opportunities for the iron & steel market.

·  Global Construction Industry: Key End-User for the Iron & Steel Market –

The application of iron and steel in the global building and construction industry is poised to grow at a CAGR of 4.6% during the forecast period. This is attributable to the substantial contribution by the construction industry to the global GDP, assessed to be 25.396%, by the World Bank. Additionally, the Global Infrastructure Outlook projects that global infrastructural investments need to reach $94 trillion by 2040. This is coupled with the fact that the U.N. has enlisted affordable housing as an SDG. Consequently, the residential real estate industry is expected to witness growth during the forecast period. These factors will be responsible for generating profits in the steel market.

·  Aerospace Industry to Contribute to Growth of the Steel Industry –

Even though steel is considered too heavy for application in an airplane, it is used for some components that need strength and hardness such as landing gear. Furthermore, the skin of some high-speed airplanes is made of steel, because the alloy is capable of withstanding high temperatures better than aluminum – a metal that is commonplace in the aerospace industry. The International Air Transport Association (IATA) projects the air transport industry to witness the production of 39,000 aircraft by 2027, thus signifying tremendous growth for the industry. The application of steel in the aerospace industry will create increased opportunities in the iron and steel market during the forecast period.

·  Machine Tools Industry Supporting the Iron and Steel Market –

ITC assessed the trade value of machine tools to be $3.43 billion in 2018, after a growth of 16% between 2017 and 2018. This resonates with the growing machine tool market, which was gauged to be valued at $62.6 billion in 2018, and is estimated to grow with a CAGR of 6.6% through to 2025. Almost all machine tools including unit head machines used for drilling, boring, milling, threading, and other industrial chores utilize iron and its alloys. Growth of the machine tools industry will lead to a lucrative demand influx in the iron and steel market.

Iron & Steel Market: Competitive Landscape

The major players expanding geographically and creating their brand value in the iron and steel market are ArcelorMittal S.A., Kobe Steel Limited, Insteel Industries Inc., N.V. Bekaert S.A., Leggett & Platt, Steel Authority of India Limited (SAIL), Bridon International Limited, POSCO Steel Making Company, Tree Island Industries Limited, and Tata Steel Limited.

·      In 2017, Insteel Industries acquired assets of Ortiz Engineered Products, Inc., which predominantly serves value-engineered reinforcing solutions to the construction industry. This acquisition will help Insteel Industry to leverage demand for steel from the construction industry.

·     In 2018, SAIL spent $2.71 billion on the expansion of its Bhilai Steel Plant. This expansion of the company's steel plant is envisioned to capitalize on the growing demand from the end-use industries. 

·    Tata Steel Limited also planned capacity expansion in November 2018, with an envisioned capacity of 30MT by 2025. This expansion will help the organization gain more steel market revenues from the end-user industries.  

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