Steel Trends for 2024
As we say goodbye to 2023, we are excited for the growth and success of the coming year. As Benjamin Franklin said, “If you fail to plan, you are planning to fail”. Taking the pulse of the steel industry is a critical step in planning a successful 2024. While the overall outlook is positive, some X variables will be important factors to monitor, affecting both the global economy and steel industry. Three key trends to watch heading into 2024 are outlined below for your review.
1. Steady Recovery
Let’s start with some concrete, good news. According to the World Steel Association, steel demand is forecasted to increase by 1.9% in 2024. Since the onset of the COVID-19 pandemic in late 2019, the steel market has been highly volatile, while simultaneously showing immense resilience in the face of unprecedented uncertainty. As of now, the steady recovery is expected to be ongoing through the rest of the decade.
2. Automotive Industry Labor Dispute
In the summer of 2023, the United Auto Workers (UAW) went on strike against Detroit’s big three automakers -- Ford, General Motors and Stellantis. As these automakers experienced significant losses, so did the industries supplying them, with the steel industry/suppliers being at the top of the list of those impacted. On October 30, 2023, the UAW came to a tentative deal that showed promise in ending the strike pending the deal’s ratification. In great news for both the UAW and steel industry, the deals were ratified at the end of November 2023, which will show a marked rebound in steel demand coming out of the automotive industry heading into 2024.
3. Global Turmoil
This year took us into the second year of the Russian-Ukranian war, and October 2023 marked the beginning of another war in the Middle East. As a rule, war worsens economic situations on a global scale. It abruptly disrupts supply chains, associated sanctions effect trade policy, and so begins the increase in energy prices and inflation. The steel industry, which closely mirrors the global economic market, has felt every bit of these consequences. The Russian-Ukrainian war has caused a decrease in metal supply and an increase in metal prices. As of December 2023, the duration and scope of the aforementioned wars are unclear, as are their effect on steel. It is worth noting that when things go awry abroad, there is an increased need for domestic materials including surplus steel.
Along with the three industry trends outlined above, ongoing efforts in urbanization and sustainability are variables worth tracking in your planning for a successful 2024. As your partner in all things steel, we recommend keeping your primary focus on what you can control; with whom you buy and sell your steel, and making sure you use surplus steel where applicable. Start your new year off strong by giving Texas Iron & Metal a call at 713-672-7595.