Whether steel exports in 2024 can continue the growth trend in 2023 and break through million tons. We analyze from the historical high growth of steel exports and the current actual situation.
Reasons for the increase in steel exports in 2014-2016. From 2014 to 2016, China's steel exports increased rapidly, of which, in 2015/2016 exceeded 100 million tons, reaching 112 million and 109 million tons respectively. The main reasons are: First, after 2010, China's steel industry overcapacity began to appear, China's steel enterprises vigorously explore Southeast Asia, the Middle East, South America and other emerging markets, steel exports to these regions increased year by year; Second, from 2014 to 2016, India and the major ASEAN economies are in rapid economic development, infrastructure investment is in full swing, and the demand for steel is good.
Whether China's steel exports can continue to increase in 2024, we analyze from internal and external reasons.
1. Global steel demand is expected to continue to increase in 2024. According to the World Steel Association estimates, global steel demand will recover by 1.8% in 2023, reaching 1,814.5 million tons after a 3.3% decline in 2022. In 2024, it will continue to grow by 1.9%, reaching 1,849.1 million tons. Among them, steel demand in developed economies will slowly recover, and steel demand in emerging economies still maintains a rapid growth rate.
2. It is expected that China's crude steel supply will continue to increase in 2024. On the one hand, the problem of excess capacity in China's steel industry is more prominent, and the long-term reduction development goal remains unchanged. China's steel consumption will peak in 2020 and is expected to maintain a downward trend for a long time, so it is imperative to reduce the development of steel consumption. In 2023, China's land transactions still maintain a significant decline, it is expected that the new construction of real estate next year is difficult to improve, real estate steel or continue to decline, infrastructure projects and manufacturing steel with a small increase, the overall steel with limited incremental. On the other hand, the benefit of steel exports is low, and increasing exports is unfavorable to the long-term development of enterprises. In order to achieve the "double carbon" goal and the high-quality development of enterprises, China has cancelled the export tax rebate policy of many varieties in 2021 to avoid the resource consumption of steel enterprises exporting low-end steel. At the same time, due to China's high dependence on iron ore imports, high-intensity production will also promote the rise in iron ore prices, which is not conducive to the cost reduction and efficiency of enterprises.
In summary, it is expected that China's steel exports will still run at a high level in 2024, but it is difficult to continue to increase. Although there is still demand in some overseas markets, whether it is for Africa, Southeast Asia, or infrastructure investment in central and South American countries, there is a certain demand for steel, China's steel demand resilience is still in. However, from the perspective of domestic supply, the domestic crude steel supply is still developing as a route of reduction, and the steel export income is low, and the probability of exports continuing to grow is small.