CRU: Covid-19 Impacts on Steel Spread to Rest of World: A Status Update

By CRU Analyst Arshiya Sibia and Research Manager Paul Butterworth, from CRU’s Steel Monitor

Current information from our China team shows that steel demand is closely tracking our base case forecast for the impact of Covid-19, though steel production remains slightly higher than we had forecast. While our forecast was for steel demand to return to normal end-April/early-May, developments outside China may now put this at risk. These relate both to rising numbers of Covid-19 infections that will impact the availability of labor, but also supply chain issues that will impact end-use activity. For example, our analysis shows that China accounts for a major proportion of global exports of both machinery and electronics, as well as grinding balls. Shortages of electronic components are already impacting auto production in India and supply chains globally are also becoming increasingly distressed.