The Arab iron and steel industry has witnessed many challenges in the past few years, which have proven its ability to survive and continue and confirm its presence in the face of difficulties.
Anyone who works in this industry is fully aware that the strength of the steel industry lies in its ability to continue and accept challenges.
What may be most important to steel producers is knowing what the conditions of the steel markets will be like during the coming period, as some fear changes that will affect the steel industry.
Although there is general agreement among analysts that there is no rule for determining the state of the market in terms of ups and downs in the near or distant future, producers see the rise in prices as an expression of the state of market recovery and thus the recovery of the steel industry, while traders see the decline in prices as a good opportunity to reduce costs resulting from changes in steel prices.
When any study is done on the iron and steel industry in the world, we find that China is considered the largest common factor in the steel industry in the world, as it is the largest steel producer in the world and accounts for 50% of steel products. What has increased the importance of China even more is the emergence of the Corona virus in it, which caused the disruption and slowdown of air and sea transport.
Many Chinese factories were also closed, causing a decline in the production of companies that rely on Chinese products. Some countries also canceled import contracts from China for fear of the transmission of the virus, as the Chinese Trade Development Authority announced that some importers of Chinese mineral products have stopped accepting shipments from China against the backdrop of the emerging Corona virus crisis, while others are seeking compensation due to delayed delivery.
The Metal Trade Council of the China Council for the Promotion of International Trade said that some companies in countries including Russia, Turkey and the Middle East and North Africa region have informed Chinese suppliers that they will not receive or are seeking to suspend purchases.
It is difficult to know the impact of this on the global economy in the long term, but it is expected that Chinese economic growth will decline from last year and global economic growth will decline from what is expected.
It is difficult to know the impact of this on the global economy in the long term, but it is expected that Chinese economic growth will decline from last year and global economic growth will decline from what is expected.
The Arab countries were not immune from these repercussions caused by the Corona virus, as they limited the movement of air and sea transport between the Arab countries after the emergence of this virus, in order to carry out the necessary prevention to limit the spread of the virus, which may cause a decline in production during the first quarter of 2020, an extension of the year 2019, which witnessed a decline in the production of most Arab countries due to the increase in inventory in light of the economic recession and the decline in oil prices, which affected the investments of Arab countries, especially oil-producing countries, in infrastructure, construction and reconstruction projects, and this was accompanied by a decrease in The volume of demand for steel products in 2019, as the Arab iron and steel industry faced a large wave of decline in the volume of demand with an increase in supply, which made some companies resort to reducing their prices and providing incentives to distributors.
Expectations for economic growth rates in Arab countries have decreased to 0.6% after it was 1.5% in 2018, despite their rise in some Arab countries, especially in North African countries. The main reason for this decline is due to the decline in oil prices and the exceptional political circumstances that some Arab countries are going through.
But it is expected that the year 2020 will be better than 2019 economically, driven by the economic reforms undertaken by many countries, led by the North African countries of Egypt, Algeria, and Morocco.
Whatever the situation is with regard to global steel markets, the situation of the Arab steel industry will remain governed by the economic conditions of the Arab countries and the growth rate of the building and construction sector. The steel industry in the Arab countries will continue to look with optimism as a result of the national investments made by investors in the Arab countries and with an eye to the challenges coming from foreign markets, especially after the countries recover from the Corona virus, especially China, which will seek to compensate for what it lost during the months of the spread of the virus and the return of transport movement to its normal state.
The Arab Iron and Steel Union hopes that the year 2020 will be promising for the iron and steel industry and achieve the goals sought by steel producers in the Arab countries.