The magnitude of the impact of the Russian-Ukrainian conflict varies by region, depending on the region’s direct trade and financial exposure to Russia and Ukraine. The conflict had a direct and devastating impact on Ukraine, and the European Union was also affected to a certain extent due to its high dependence on Russian energy. Not only that, the impact of the Russian-Ukrainian conflict has also spread globally due to rising energy prices (especially the refractory raw materials needed for steel production), resulting in continued disruption of supply chains in some regions, a problem that has plagued the global steel industry even before the conflict broke out.
The impact of the Russian-Ukrainian conflict continues to spill over, superimposed on the slowdown of China's economic growth, the World Steel Association predicts that the growth of global steel demand in 2022 is expected to decrease. In addition, the continuous outbreak of the new crown pneumonia epidemic and rising interest rates in some parts of the world have also brought risks of economic downturn. The expected tightening of U.S. monetary policy will increase the risk of financial fragility facing emerging economies.
The forecast for global steel demand in 2023 is highly uncertain. The World Steel Association said the forecast is premised on the end of the Russian-Ukrainian conflict in 2022. In addition, the geopolitical pattern surrounding Ukraine will have an extremely far-reaching impact on the global steel industry, including the adjustment of the global trade pattern, the transformation of energy trade and its impact on the energy transition, and the continuous reconfiguration of the global supply chain.
