Stainless Steel Market Trends

Growth Drivers

• Global Inelastic Demand for Steel – One of the determinants of the price elasticity of steel is the nature of the commodity.  Steel is categorized as a necessity good because it is necessary for manufacturing and development in almost all sectors of the modern economy. Hence, when the price of steel fluctuates, the demand for the material does not alter considerably. This happens wherever steel is essential to the end product's operation or if it is employed in goods or sectors where there are few alternatives. From 1950, the total crude steel production has grown from 190 million tons to over 1800 tons in 2020 around the globe.

• Demand in Automobile Industry – In a regular modern car, steel accounts for more than 50% of the total material used. Steel consumption and production will rise in direct proportion to the use of steel as a raw material in the automotive sector. Global auto sales increased from 62 million in 2020 to more than 67 million in 2021. This is largely attributable to the - emergence automobile industry, which lost a significant portion of its revenue as a result of the epidemic.

• Quality of Being 100% Recyclable – Since steel is 100 percent recyclable, it may be repeatedly recycled into the same type of material. A refrigerator, a car door, or a roof panel can all be made from a single steel beam. In North America, between 62 and 85 million tons of steel scrap are recycled each year into new steel products. The North American steel industry has recycled more than 1000 million tons of steel scrap into new steel during the last three decades.

• Demand for Stainless-steel in Energy and other Industries – The steel demand is significantly influenced by the energy sector. Numerous energy-related processes rely on steel, including the construction of nuclear power plants, pipelines for oil and gas, and wind turbines. The energy industry continues to expand globally as a country's energy infrastructure is improved. A high-voltage transmission tower typically weighs between 18000 to 28000 kilograms of steel. Apart from that, applications in packaging, medical instruments, and cookware all require steel to create quality products.

Challenges

• Availability of Substitute Materials - Materials that can be utilized in some applications in place of steel are known as substitute materials. They include aluminum and wood, as well as composites like carbon fiber-reinforced plastic and fiberglass-reinforced plastic. In some cases, for instance, in the automobile industry, aluminum or carbon fiber can be used for lightweight body panels. Another instance is the use of wood or fiberglass sheets in construction applications.

• Decarbonization Issues - The average amount of carbon dioxide released per ton of steel produced was over 1.7 tons or roughly a tenth of the world's total emissions. As a result, steel producers all around the world, are dealing with decarbonization issues, while finding more efficient and eco-friendly ways to produce.

• Supply Chain Delays and Issues