Global Steel Demand Slows, Asia Resilience Still Supports Ferrous Metals Outlook
Global steel demand growth expectations have been notably downgraded this year, putting near-term pressure on the ferrous metals industry. However, demand in Asia remains resilient, providing medium- to long-term support, and Singapore is expected to further cement its role as a ferrous metals trading hub.
Minister of State for Trade and Industry and National Development Alvin Tan said on Tuesday (June 16) at the opening of the Singapore International Ferrous Week that the 2026 global steel demand growth forecast has been revised down from about 1.3% at the start of the year to 0.3%, but is expected to recover to around 2.2% in 2027.
Supply Chain, Cost, and Trade Policy Create Short-Term Pressure
Tan noted that short-term pressures on the industry stem from three areas: supply chains, costs, and trade policy. The Middle East conflict has disrupted supply of raw materials such as direct reduced iron (DRI) and hot briquetted iron (HBI); rising energy and freight costs further burden companies; and trade policy and tariff changes continue to affect global steel trade flows.
Nonetheless, Asian demand remains a key pillar supporting the industry outlook. Southeast Asia, driven by urbanization, population growth, and large-scale infrastructure projects, still has long-term demand from high steel-consuming sectors like 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 may accelerate further in 2027.
Singapore Strengthens Position as Ferrous Metals Trading and Hedging Hub
Tan noted that Singapore is currently one of the world's leading ferrous metals trading hubs, hosting over 60 major miners, global traders, and other key players across the value chain. Ferrous metals mainly refer to iron and steel, including iron ore, steel products, pig iron, scrap, and ferroalloys.
In addition, the Singapore Exchange (SGX) is the largest seaborne iron ore derivatives exchange outside of China, with trading volumes far exceeding the physical market, helping companies hedge risks in real time amid market volatility.
Green Metals Forum Debuts
This year, Singapore International Ferrous Week introduced the Singapore New Energy Metals and Materials Forum for the first time. The forum is co-organized by Green Esteel, a local steel company focusing on green and low-carbon development, and Shanghai Metals Market.
Tan said the forum will bring together global players to exchange ideas on emerging materials trends and forge strategic partnerships.
He also noted that technology adoption and low-carbon transformation will be key priorities for upgrading the ferrous metals industry. Under the National AI Strategy 2.0, Singapore is investing in computing power, talent, and industrial applications, and has set up over 50 AI Centers of Excellence with industry partners.
For example, global mining group Rio Tinto is collaborating with AI Singapore to develop AI tools to improve freight invoice processing and reduce transaction processing time for thousands of cargo 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 testing of low-carbon alternative fuels.
