Global Steel Demand Growth Slows; Asian Demand Still Provides Support
Global steel demand growth forecasts have been sharply downgraded this year, putting short-term pressure on the ferrous metals industry. However, Asian market demand remains resilient and will provide medium-to-long-term support, while Singapore is expected to consolidate its position as a ferrous metals trading hub.
Minister of State for Trade and Industry and National Development Alvin Tan said at the opening ceremony of Singapore International Ferrous Week on Tuesday (June 16) that the global steel demand growth forecast for 2026 has been cut from about 1.3% at the start of the year to 0.3%, but the industry expects a recovery to about 2.2% growth in 2027.
Tan noted that short-term pressures facing the industry come mainly from supply chains, costs and trade policies. The Middle East conflict has disrupted supplies of raw materials such as Direct Reduced Iron (DRI) and Hot Briquetted Iron. Meanwhile, rising energy and freight costs add to corporate burdens. Changes in trade policies and tariffs also continue to affect global steel trade flows.
Despite this, Asian demand remains a key support for the industry's outlook. Southeast Asia, driven by urbanization, population growth and large-scale infrastructure projects, continues to have long-term demand in steel-intensive sectors such as construction and manufacturing.
Notably, India is emerging as a major growth market, with steel demand expected to grow about 7% in 2026, and the pace could accelerate further in 2027.
Singapore Consolidates Its Role as Ferrous Metals Trading and Hedging Hub
Tan noted that Singapore is currently one of the world's major ferrous metals trading hubs, hosting over 60 key companies across the value chain, including miners and global traders. Ferrous metals mainly refer to iron and steel, with common categories including iron ore, steel, pig iron, scrap metal and ferroalloys.
Additionally, the Singapore Exchange is the largest exchange for seaborne iron ore derivatives outside China, with trading volumes far exceeding the physical market, helping companies hedge risks in real time during market volatility.
Green Metals Forum Debuts
For the first time this year, Singapore International Ferrous Week features the Singapore New Energy Metals and Materials Forum, co-organized by Green Esteel, a Singapore-based steel company focusing on green and low-carbon development, and Shanghai Metals Market.
Tan said the forum will bring together global players to exchange views on emerging material trends and build strategic partnerships.
Tan also noted that technology application and low-carbon transition will be key areas for upgrading the ferrous metals industry. Under Singapore's National AI Strategy 2.0, the country is investing in computing power, talent and industrial applications, and has established over 50 AI centers of excellence with industry partners.
He cited the example of global mining group Rio Tinto, which is collaborating with AI Singapore to develop AI tools for improving freight invoice processing and reducing transaction times for thousands of shipments.
On decarbonization, Tan said Singapore, as a global maritime hub and home to the Global Centre for Maritime Decarbonisation, will continue to promote green shipping corridors and low-carbon alternative fuel testing.
