Global steel demand is likely to recover in 2010, following two years of economic crisis-linked slumps, while South African and African demand should rebound strongly next year, a World Steel Association (worldsteel) "Short Range Outlook" statement, issued on Monday, indicates.

The body, which comprises some 180 steel companies (including producers from South Africa) with a combined output representing around 85% of global production, said that "with signs ... of a recovery across the world now apparent, global steel demand in 2010 is forecast to grow by 9,2%" to 1,21-billion tons, representing a return to 2008 levels.

It also released a materially improved, albeit lower, forecast for consumption in 2009. Apparent use would contract by 8,6% to 1,04-billion tons, following on from the decline of 1,4% recorded in 2008 - a substantially improved outlook when compared with the 14,1% contraction forecast by worldsteel in April.

South African and African demand had also been affected by recessionary conditions in many parts of the world, but this too was forecast to recover in 2010. African apparent use was expected to be nearly flat at 26,3-million tons in 2009, and was predicted to rise 11,4% to 29,3-million tons in 2010.

But South African apparent use would contract by nearly a quarter (24,5%) this year to 4,6-million tons as compared with 6,1-million tons in 2008. But worldsteel was forecasting a recovery of over 20% to 5,6-million tons in 2010.

"The global recovery is stronger than we predicted in April," worldsteel Economics Committee chairperson Daniel Novegil said, adding that the improvement was largely attributable to "exceptionally strong" growth in China.

China, which would be continue to be the key driver of future demand, could rebound by 19% in 2009 and 5% in 2010. China's apparent steel use in 2009 was expected to increase by 18,8% to reach 526-million tons, or 47,7% of total apparent use - excluding China, potential world steel demand would have fallen by 24,4 %.

India also remained "relatively resilient" and apparent steel use was expected to grow by 8,9% and 12,1% in 2009 and 2010 respectively.

Demand in North America and the Europe, which were at the epicentre of the crisis, fell massively and even after an anticipated recovery during 2010, apparent steel use is only likely to reflect levels last witnessed in 1991.

North America was expected to show a 35,8% decline in 2009, before returning to a growth of 17,1% in 2010. Apparent steel demand in the US is likely to fall by 38,7% to 60-million tons in 2009, over and above the country's 8,2% contraction of 2008. But US demand could recover by a strong 18,8% to 72-million tons in 2010.

The 27 European Union economies were also severely affected by the crisis and the region's apparent steel use was expected to fall by 32,6% in 2009 to 122-million tons. In 2010, the apparent steel use in the economic bloc was expected to grow by 12,4%.

Japan would see its apparent steel use decline by 31,3% in 2009, before recovering by 15,8% next year to reach 61-million tons.

Apparent steel use in the Commonwealth of Independent States region is expected to contract by -30,8% in 2009 and should grow by only 8,2% in 2010.

"Emerging economies will slow down 17% in 2009, to grow 12% in 2010. Apparent steel use in developed economies, that contracted 34% in 2009, will rebound 15% in 2010," Novegil added.

The return to growth in 2010 was described as "moderate", with worldsteel members still concerned about uncertainties regarding the resilience of the recovery and possibility of premature reductions in government stimulus actions.

"This uncertainty particularly exists for the Chinese economy in 2010, whose fast recovery in 2009 was largely enabled by such strong government stimulus policies," Novegil concluded.