India’s steel demand may grow 3.3 per cent this year on higher demand from construction and manufacturing sectors, the World Steel Association (WSA) said.

“In India, steel demand is expected to grow by 3.3 per cent to 76.2 million tonnes in 2014, following a 1.8 per cent growth in 2013,” the WSA said in its short-range outlook for 2014 and 2015 released on Wednesday.

The industry organisation, whose members represent about 85 per cent of the world’s steel production, expects the growth on an improved outlook for the construction and manufacturing sectors, although this may be constrained by high inflation and structural problems.

“Despite uncertainties relating to the impact of upcoming elections, steel demand is projected to grow by 4.5 per cent in 2015, supported by the expectation that structural reforms will be implemented,” the WSA said.

Globally, steel use would increase by 3.1 per cent to 1,527 million tonnes in 2014, following growth of 3.6 per cent in 2013. In 2015, this would increase by 3.3 per cent to 1,576 million tonnes.

“In 2013, world steel demand grew higher than our previous forecasts due to a stronger-than-expected performance in the developed world in the second half of the year. In particular, the recovery in the US gained strength,” said Hans J Kerkhoff, Chairman of the Worldsteel Economics Committee.

Despite the bottomed-out downturn in the EU, growth this year will be impacted as many emerging economies continue to struggle with structural issues and financial market volatility along with deceleration in China.

“In 2015, growth in most parts of the world will accelerate, thanks to a continuing steady recovery in the developed economies and an improvement in the situation for the emerging economies,” he said.

China’s steel demand will decelerate further and this will prevent the broad recovery momentum from registering a higher global growth rate for 2015, Kerkhoff said.

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