In 2024, global steel prices are probably going to be muted.

Even though Chinese steel prices slightly recovered in the second half of 2023, global steel prices will probably stay low in 2024.

According to research firm BMI, a division of Fitch Solutions, low prices will keep a check on global average prices, particularly in significant markets outside of China.

In its December Resources and Energy quarterly report, the Australian Office of the Chief Economist stated, "Global steel demand remains weak, driven by lower demand from manufacturing and construction in developed economies and ongoing weakness in China's property sector."

The expansion of economies in developed nations may be impacted by tight financial conditions and rising inflation. According to BMI, the prolonged conflict in Ukraine may further harm the European Union's economic prospects and consequently have an impact on steel prices and demand. 

In order to prepare for a possible price improvement in the upcoming months, BMI said, "We have revised downwardly our 2024 global average steel price forecast to $740/tonne from $780/tonne previously. We expect to start the year at a lower base level than we previously expected."

The economic and financial analysis division of the Dutch multinational financial services company ING, ING Think, reports that new data from the China Iron and Steel Association (CISA) indicates that major Chinese steel mills' steel inventories increased to 14.1 million tonnes in early December, an 8.8% increase from late November. 

The Australian Office of the Chief Economist stated that it is unclear how much the Chinese government will restrict steel production levels in the last few weeks of 2023. 
Given that the government places a higher priority on economic growth, production cuts have not yet been strictly enforced. But a slight slowdown in Chinese steel production is anticipated," the statement read. 

According to BMI, production is beginning to show signs of improvement on the global supply side.

According to the Australian Office of the Chief Economist, additional stimulus-related infrastructure projects along with a projected stabilisation and gradual uptick in global industrial production should support stronger growth in the steel demand in 2024.  

BMI stated that while production is expected to rebound in other important markets, it expects an improvement in supply-side production growth driven by Chinese steel mills.