Production is expected to recover 1.3% this year and 0.5% – in 2025, after falling 2.4% in 2023
Steel pipe production in the European Union will grow moderately in 2024-2025, after falling in 2023. In particular, production in the industry is expected to grow by 1.3% y/y this year and 0.5% y/y /a – in 2025. at the same time, in 2023, according to EUROFER forecasts, EU pipe companies will reduce production by 2.4% per year, according to the association's report Economic and Industry Perspectives steel market 2024-2025, first quarter.
In the third quarter of 2023, EU steel tube production increased by 1.3% year-on-year, following a 4.5% year-on-year decline in the previous quarter.
“The positive trend in the pipe sector following the COVID-19 pandemic was disrupted by the war in Ukraine and supply chain issues in the second half of 2022. The energy crisis also had a significant impact on the sector,” the report states.
According to the association's forecasts, demand for large welded pipes for the oil and gas industry will not recover in the long term, as the EU has accelerated its transition to transporting liquefied natural gas for energy needs, reducing thus dependence on pipeline gas. At the same time, the weakening of global oil demand is not expected to stimulate the launch or implementation of new pipelines in the short term, in a context of high geopolitical uncertainty and weak economic prospects.
Demand for tubes in the construction sector is also expected to decline, while the automotive and machine building sectors will continue to be the main drivers of tube production growth in the EU.
As the GMK Center previously reported, according to EUROFER forecasts, apparent steel consumption in the European Union is expected to decrease by 6.3% in 2023 compared to 2022, to 129 million tonnes. At the same time, in 2022, the number decreased by 6.5% y/y and in 2024 it is expected to grow by 5.6% y/y.
