Steel has enabled our modern way of life. It has helped lift societies out of poverty, spurring economic growth, and continues to do so around the world today.
Iron, steel’s precursor, fueled the industrial revolution starting in 1750, enabling manufacturing equipment in factories and rail transport. Modern steel-making was developed 150 years ago with the invention of the Bessemer process allowing for the affordable mass-production of steel (an iron alloy). This set off a second industrial revolution, and sustained economic growth.
Today, steel is one of the most common materials in the world. We rely on it for our housing, transport, food and water supply, energy production, tools and healthcare. Nearly everything around us is either made of steel or manufactured by equipment made of steel.
Steel is inextricably linked with economic growth and prosperity, as shown in Figure 1. This figure estimates stocks of steel per person, based on their current wealth (GDP per person), and suggests that as a person’s income increases they build up their stock of steel, which then tends to reach a plateau.
Developing societies require steel to build new roads, railway lines, buildings and bridges. They also need it to lay new pipelines for gas, water and sanitation and to build factories and machinery.
Once basic infrastructure needs are met and GDP continues to rise, the demand for consumer goods such as washing machines and refrigerators increases, as does the need for mobility via trains, buses and automobiles – all of which require steel for their production and related infrastructure (stations and fueling). Urbanization is also enabled by steel – e.g. allowing for high-rise buildings.
Steel stocks per person, or the demand for steel in developed societies tends to plateau as a certain level of wealth is reached and the need for new infrastructure and buildings are satisfied. Per capita demand tends to remain high in areas with high industrial production, contributing to sustained economic growth.
For example, steel demand is high in South Korea due to the country’s high level of steel exports in steel-containing goods such as ships and cars.
It is also high in Japan because of shipbuilding, engineering and automotive – it remains a big net exporter of automotive vehicles. Steel is also required in both of these highly urbanized countries for highrise buildings that are earthquake resistant.
Stock levels for steel in China and India in particular are expected to grow significantly by 2050 to meet their growing need for buildings, infrastructure and transport in a sustainable way. There will also be strong growth in steel production in other areas of the world where steel will be vital in raising the material and social welfare of developing societies.
Steel will continue to be needed in both developed and developing countries in advanced and new applications that support sustainable development and thereby, a green economy.
Source: World Steel Association
Jovelle W. // SMC Editor
International Trade and Marketing Specialist