Canadian steel producer Stelco Holdings’ chief executive officer (CEO) predicts a remarkable comeback of the industry that will lead to a surge in steel demand.
The company’s CEO, Alan Kestenbaum made a revised prognosis recently and according to media reports, this optimism was not observed in February. The company became more confident over the past two weeks noting the developing demand for steel in end markets.
The enhanced sentiment is owed to the improved outlook on future automotive sales in the US along with a boost in oil drilling activity. Kestenbaum predicts auto sales will begin to surge in Q3 2021 and reach a highpoint by Q4 when consumers will likely resume former routines as restrictions are lifted due to vaccines tackling the COVID-19 pandemic.
The company spokesperson also cited auto sales are forecast to increase to the lower to mid 20 million units in 2022 compared to prior estimates of close to 17 million vehicles, per reports. Also, as pipe inventories are falling, the steelmaker has received a large influx of new orders from energy providers.
Following Stelco’s February earnings report, hot-rolled coil prices have risen about 9pc and the company feels this movement will extend into May pricing. The company also noted it has already begun to receive pig iron pricing inquiries from Brazilian steelmakers following its caster rollout in February, also pointing to strengthening demand.