LONDON--(BUSINESS WIRE)--The global steel casting market is expected to grow at a CAGR of more than 4% during the period 2018-2022, according to a new market research study by Technavio.
The report presents a comprehensive research of the global steel casting market by application, including automotive and transportation, construction and infrastructure, mining, power, and oil and gas. The report also determines the geographic breakdown of the market in terms of detailed analysis and impact, which includes key geographies such as APAC, the Americas, Europe, and ROW.
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Market driver: increasing investments in infrastructure
The global construction industry has been witnessing rapid growth. A substantial contribution has been coming from the emerging countries. In 2016, the revenue generated by the global construction industry increased significantly. The emerging countries such as China, India, Brazil, Mexico, Saudi Arabia, South Africa, Russia, and Nigeria accounted for approximately 52% of the total construction industry in 2016. This can be attributed to the increase in public infrastructure projects such as airports, IT parks, and hospitals.
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Market trend: increasing use of electric arc furnace
The steel industry involves high consumption of energy that results in high cost of production. The use of energy depends on the process that is used for manufacturing steel. There are two different processes, including blast furnace and electric arc furnace. The blast furnace is an energy-intensive process, which involves the use of iron ore and the circulation of super-headed oxygen over it to make molten iron. Obtained molten iron contains high levels of impurity that is further refined to obtain pure steel, which is used for steel casting.
According to a senior analyst at Technavio for metals and minerals research, “The electric arc furnace is a less energy-intensive and more efficient process wherein steel scrap is added to the furnace that transforms into molten steel with high purity. The main advantage of electric arc furnace is that the removal of carbon is not required. High purity steel is obtained without any carbon content and is the key reason for electric arc furnace being preferred.”
Market challenge: supply-demand imbalance in the steel industry
Many steel manufacturers are establishing massive capacities around the globe. Over the last decade, the steel industry has been investing in capacity expansion due to the availability of relatively attractive interest rates for new investments, low production costs, and an open international market. The disparity in the demand and supply of steel is expected to result in lower prices, capacity utilization rates, and profitability for the manufacturers. Thus, this uneven supply and demand for steel is a substantial challenge for steel casting market during the forecast period.
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