Global Steel Industry - Overall Industry Trends
Four current trends related to the global construction-grade steel industry include the increasing use of prefabricated steel buildings, the application of automation which improves quality and efficiency, production capacity and profits, and the utilization of digital technologies to address labor shortages.
FOUR latest trends in the global construction-grade steel industry
1. Prefabricated steel buildings
- With the ongoing rise in the number of special economic zones (SEZs) across the globe, new corporate offices are being constructed. Prefabricated steel buildings are preferred in such zones because they are easy to construct and have an easy setup.
- Moreover, with the strong growth in construction activities across the world, construction companies are looking for convenient alternatives to conventional construction.
- The convenience and simplicity offered by prefabricated steel buildings are the primary reasons why prefabricated buildings are among the top steel industry trends.
- Pre-engineered steel building kits are versatile and can be constructed quickly.
- Prefabricated steel buildings are also reasonably priced.
2. Automation to improve quality and efficiency
- Automation is becoming increasingly important in every area of fabrication.
- Computer-managed automated production has been resulting in a higher quality of welding, improved speed, and general efficiency.
- Equipment such as the Ficep beam line enables construction companies to deliver remarkable results within a shorter time period, thereby, resulting in an improved capacity.
- Further, the structural steel industry is expected to reap the benefits of prescriptive analytics as it results in improved scheduling, logistics, and upgrade selection, among others. These improvements enable construction companies to further increase their productivity and decrease the cost of structural steel.
3. Production capacity and profits
- The growth of the Chinese economy during the early 2000s was a profitable period for steelmakers. The global construction steel industry significantly expanded its production at an average rate of 4.9% per year between 2004 and 2013.
- China's growth, however, has recently been slowing down and the global construction steel industry is facing the typical post-boom challenge of excess supply.
- Although the demand for steel peaked in 2013, the capacity continued to expand up to 2016 due to "inertia of capital investment." Between 2013 and 2016, the global capacity increased with an additional 60 million metric tons despite the decreasing demand.
- As a result, since 2016, the global steel industry has fallen into a severe crisis with numerous plants producing excess steel relative to diminishing demand. This has resulted in lower profits for the majority of players in the industry.
4. Digital Technologies and labor shortages
- The structural steel industry has been embracing digital technologies in response to labor shortages and competitive pressures.
- The structural steel fabrication industry has been using 3D model-driven technologies to decrease waste, streamline shop fabrication, and improve quality.
- The use of digital technologies has enabled structural steel industry to not only deal with labor shortages but also become more cost-effective and scalable to meet client demand.
We commenced our research by gaining an understanding on the types of steel used in the construction industry and found an article mentioning that the three most common types of steel used for construction are structural steel, carbon steel, and rebar steel. Armed with this information, we started to search for the latest trends around these types of steel. We were able to find reports and articles identifying trends in prefabricated buildings, automation in the steel industry, the impact of the Chinese market on the industry, and the use of digital technologies in dealing with labor shortages. These trends were chosen because they reflected recent changes or addressed challenges in the steel industry. For instance, the growing popularity of prefabricated steel buildings is a recent development and impacts the operations of companies in the industry and adopting digital technology addresses labor problems.
In our search, we came across other trends in the areas of 3D printing technologies, distribution channels, and supply chain management. As these areas were being addressed in other requests, they were not added to the trends in this brief.