NEW YORK—Growth for the U.S. steel industry will not accelerate until at least 2015 when the impact of government-funded initiatives is felt in the industries that consume the most steel, according to a new report.
The U.S. Steel Industry Outlook, a report from market research firm SBI, says the industry will post a 3.6 per cent compound annual growth rate (CAGR) between 2018 and 2022, reaching a market value of $95.6-billion.
A slow recovery from the automotive, construction and heavy equipment manufacturing industry has directly impacted the production for steel since its boon between 2006-2007, according to the report.
The recovery for the steel market, however, has been steady since the massive decline in 2009.
The report says the U.S., which accounts for over two-thirds of the North American steel production, will produce 89.6-million tons of steel by the end of 2012.
“The complete economic impact of the U.S. steel industry is forecasted to be in excess of $80.1-billion in 2012,” SBI publisher Shelley Carr said in a statement. “As the industry recovers, this impact will continue to climb upwards of $15-billion over the next 10 years.”
The report finds the automotive industry, which is the leading segment of the U.S. steel market, has remained somewhat resilient through the declining years of steel production.
In addition, the versatility and reliability of steel over other construction materials will see a boon from the construction industry alongside its recovery.
“When you break down the automotive steel segment, 70 per cent of it is original manufacture and 30 per cent is aftermarket,” Carr said. “For construction, steel can be recycled and given a credit under the Leadership in Environmental and Energy Design (LEED), making it more ‘green’ when compared with other choices, a notable advantage.”
The report examines the competitive and economic challenges facing raw steel producers and end-users of steel.
Its analysis includes a historical perspective of the U.S. steel industry between 2006 and 2011 and forecasts the market value through 2022.