Steel Market Trends and Demand

New Zealand is famous for its abundance of natural beauty and its friendly inhabitants, but did you know that it is also the corten steel nz producer of the world? This small country is located in the south-western Pacific Ocean and it became an independent nation in September 1963. Its territory spans over 140 million years of geological history, which you can read more about here.

This country's biggest export is wool, which was historically used for clothing and blankets. However, today it is mainly bought by companies that utilize it in industrial applications. The story behind that is pretty incredible. As a result of New Zealand's incredible natural beauty, it was impossible to ignore the country when they were looking for raw materials to fabricate their steel. The government knew that they would have to look beyond their own borders to secure the steel they needed, and so they did. By 1960, NZ was producing more than 10 million tons of steel per year, which accounted for around 15% of the entire world production. That makes it the 4th largest steel producer in the world at that time.

Since then, the country's steel production has continued to rise. In fact, it is currently the 3rd largest steel producer in the world, with 24.5 million tons per year. To meet the ever-growing demand, in 2016 alone NZ expanded by 7.7%, with the establishment of 3 new steelworks, as reported by the Economic Development Board. This is a positive sign for the country's economy, as the steel and metal industries contribute significantly to New Zealand's GDP.

A Brief History of the Steel Industry in New Zealand

The steel industry in New Zealand was founded back in the early 1900s, when the country began importing the basic materials and machinery needed to operate steel mills. Even then, the steel industry in New Zealand was considered a “niche” industry, mainly employed by giant companies that could afford the expensive steel fabrication process. The largest steel manufacturer in New Zealand at that time was Massey, who imported the materials from England by rail. You can learn more about this history by checking out the website for the Steel Society of New Zealand.

With the development of the World War II, the country's steel production surged, as the government encouraged and supported businesses to get involved in the manufacturing of military equipment. During the war, the steel industry grew by approximately 500%, as demand soared. This is because after the War, many companies decided to keep the steel fabrication process, as they were able to secure a steady supply of materials. When the war ended, many of these companies looked for new, sustainable markets to operate in. This led to the development of a “niche” steel industry, as the country's largest companies moved into other areas of the economy. However, many smaller companies that sprung up during the war stayed in the steel industry and continued to thrive. The government also provided assistance by setting up a Ministry of Steel in 1951, which sought to ensure that all businesses involved in the steel industry had access to finance, marketing expertise, and technological innovation.

Since then, the country's steel industry has continued to grow, fueled by new discoveries of raw materials such as iron ore, coal, and limestone. In 1960, NZ produced nearly 15 million tons of steel; in 2012, that number jumped to nearly 100 million tons. To meet this demand, the country's steel mills have had to upgrade their production processes and expand their facilities. This has led to a rise in jobs within the industry, as you will see below.

Why Are So Many People Interested In Steel Market Research?

Steel is a raw material that is in high demand, and as a result, the prices are always on the rise. In addition to this, demand for steel can fluctuate wildly, which makes it an unpredictable market. All of this makes it a great investment opportunity for those who want to try their hand at economic speculation. There are a variety of ways that you can play the steel market, from short-term buying and selling, to looking at the long-term trends and possibilities. Some individuals who indulge in this kind of speculation do so because they consider it a “low-risk” way to make extra cash, as the prices usually stay stable for the most part. Alternatively, others might be interested in making long-term investments in companies that produce steel and other metal-based products.

Whether you are looking to make a quick buck or want to enter the steel market on a long-term basis, you should consider getting in touch with the professionals at SC Strategy. They can provide you with all of the information that you need, and they can help you make the right decision for your situation.

Top 5 Markets To Consider

Now that you know a little bit about New Zealand's steel industry, you can get a good look at why it is such a lucrative market, and what opportunities there are for those who want to get involved. Below, you will find a list of the top five markets to consider, as well as some information about each of them.

  • Steel Market Trends
  • Steel Demand
  • Production Facilities
  • Economic Indicators
  • Favored Investing Countries

It is a common practice in the steel market for producers to survey the current trends and future expectations in steel. This is because the production and sales of steel are so dependent on the demand and prices for the commodity, which can change quickly. As a result, knowing what is currently popular and what is soon to be fashionable can lead to big money if you are able to predict the future market. The key to doing this successfully is by keeping up with the current trends, as this way you will be able to determine which items are heading in which direction and how fast they are moving. This way, you can produce high-quality products that are tailored to the current market and meet the demands accordingly.

SC Strategy regularly publishes reports, which are updated every three months, that examine the current trends in the steel market. These reports give you a good idea of what is popular now, as well as what is on the horizon as far as the future of steel is concerned. If you would like to stay informed about the most recent trends in the steel market, then you should sign up for the SC Strategy updates to get the information directly in your email.

Steel Demand

Steel demand is one of the main indicators of the current state of the steel market. The demand for steel is highly correlated to the demand for other metals, as all metal fabrication starts with base materials that were mainly drawn from ore. In order to estimate the demand for steel, you need to look at the demand for the metals that it is made of, as well as how much is actually being produced.

For example, if you look at the demand for iron in 2016, you will see that this year it reached record levels. The global demand for iron ore reached 270 million tons, an increase of nearly 5 million tons since 2015. This trend is expected to continue, as it was revealed in a report by the Federation of Engineering Organizations that the world's appetite for iron ore is expected to double by 2025. All of this talk of iron ore led us to our next point…

Production Facilities

Production facilities are another important element of the steel market. If you are a company that wants to enter the steel market, you will need to have facilities that are able to produce the quantity of steel that you intend on selling. The cost of building production facilities is relatively expensive, and it is always a good idea to look for potential savings in the form of scale. The larger the scale of the operation, the lower the overall cost per ton. Having more than one shift enabled the company to better manage demand and supply, as well as increase production. Also, if you operate in a closed-loop system, the energy cost is reduced, as the less fuel that is used, the less costly it is. The company's experience showed them that the benefits of operating in a bigger scale were more than worth the investment.

Economic Indicators

Besides steel market trends and demand, the economy stands as one of the main factors that influence the overall price of steel. The world's largest economies, particularly China and India, heavily depend on steel production for a variety of reasons. First and foremost, they are extremely populous countries that need a lot of materials to build and maintain their growing economies. In addition to this, many of the country's biggest industries, including automobiles, steel fabrication, and electronics, heavily rely on machinery and raw materials from other countries. As a result, the economies of China and India are highly susceptible to the cost of imported materials.

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Pub: 28 Sep 2023 08:34 UTC
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