Global steel demand slows, Asia demand continues to support ferrous metals outlook
Global steel demand growth expectations have been sharply downgraded this year, putting short-term pressure on the ferrous metals sector. However, Asian demand remains resilient, providing medium- to long-term support. Singapore is also expected to consolidate its position as a ferrous metals trading hub.
Speaking at the opening of Singapore International Ferrous Week on Tuesday (June 16), Minister of State for Trade and Industry and National Development Alvin Tan said that the 2026 global steel demand growth forecast has been cut from about 1.3% at the start of the year to 0.3%, but the industry expects a rebound to about 2.2% growth in 2027.
Tan noted that short-term pressures come from three areas: supply chains, costs, and trade policies. The Middle East conflict disrupts supplies of raw materials like Direct Reduced Iron (DRI) and hot briquetted iron. Meanwhile, rising energy and freight costs add to business burdens; trade policy and tariff changes also continue to affect global steel trade flows.
Despite this, Asian demand remains a key pillar supporting the industry outlook. Driven by urbanization, population growth, and massive infrastructure construction in Southeast Asia, sectors that consume large amounts of steel, such as construction and manufacturing, still have long-term demand.
Notably, India is also emerging as a major growth market, with steel demand expected to grow about 7% in 2026, and the pace set to accelerate further in 2027.
Singapore consolidates ferrous metals trading and safe-haven hub status
Tan pointed out that Singapore is currently one of the world's leading ferrous metals trading hubs, hosting over 60 miners, global traders, and other key players in the value chain. Ferrous metals mainly refer to iron and steel, with common categories including iron ore, steel products, pig iron, scrap steel, and ferroalloys.
In addition, the Singapore Exchange is the largest exchange for seaborne iron ore derivatives outside 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's Singapore International Ferrous Week added the Singapore New Energy Metals and Materials Forum for the first time. The forum is co-organized by Green Esteel, a Singapore-based steel company focused on green and low-carbon development, and Shanghai Metals Market.
Tan said the forum will bring together global players to exchange ideas on emerging material trends and build strategic partnerships.
Tan also noted that technology application and low-carbon transformation will be key upgrades for the ferrous metals industry. Under its National AI Strategy 2.0, Singapore is investing in computing power, talent, and industrial applications, and has established over 50 AI Centers of Excellence with industry partners.
He cited global mining giant Rio Tinto, which is collaborating with AI Singapore to develop applied AI tools to improve freight invoice processing and shorten transaction processing times for thousands of shipments.
On decarbonization, Tan said that as a global maritime hub and home to the Global Centre for Maritime Decarbonisation, Singapore will continue to promote green shipping corridors and low-carbon alternative fuel trials.
