Asian Steel Demand Resilience Supports Outlook: Analysis by Chen Shenghui

Global steel demand growth expectations have been significantly lowered this year, putting short-term pressure on the ferrous metals industry. However, Asian market demand remains resilient, providing medium-to-long-term support, and Singapore is expected to further consolidate its position as a ferrous metals trading hub.

Minister of State for Trade and Industry and National Development Chen Shenghui stated at the opening of Singapore International Ferrous Metals Week that global steel demand growth forecast for 2026 has been revised from around 1.3% at the beginning of the year to the current 0.3%, but is expected to rebound to about 2.2% growth in 2027.

Chen Shenghui noted that current short-term pressures on the industry mainly come from supply chains, costs, and trade policies. The Middle East conflict disrupts supply of raw materials such as Direct Reduced Iron (DRI) and hot briquetted iron; rising energy and freight costs further burden enterprises; and changes in trade policies and tariffs continue to impact global steel trade flows.

Despite this, Asian demand remains a key force supporting the industry outlook. Southeast Asia, driven by urbanization, population growth, and large-scale infrastructure construction, has long-term demand in steel-intensive areas such as construction and manufacturing.

Chen Shenghui also mentioned that India is becoming a major growth market, with steel demand expected to grow about 7% in 2026 and further accelerate in 2027.

Singapore Consolidates Status as Ferrous Metals Trading and Hedging Hub

Chen Shenghui stated that Singapore is currently one of the world's major ferrous metals trading hubs, hosting over 60 key companies across the value chain, including miners and global traders. Ferrous metals mainly refer to iron and steel, with common categories including iron ore, steel products, pig iron, scrap steel, and ferroalloys.

He noted that the Singapore Exchange is the largest seaborne iron ore derivatives exchange outside China, with trading volumes far exceeding the physical market, helping enterprises hedge risks in real time amid market volatility.

Chen Shenghui emphasized that Singapore has trading talent, shipping connectivity, trade finance, and a rules-based legal system. These conditions enable enterprises to execute contracts, manage risks, and flexibly adjust trade routes when supply chains are disrupted.

Green Metals Forum Debuts and Low-Carbon Transition Focus

For the first time this year, Singapore International Ferrous Metals Week added the Singapore New Energy Metals and Materials Forum, co-organized by Green Esteel, a steel company focusing on green and low-carbon development, and Shanghai Metals Market.

Chen Shenghui said the forum will gather global players to exchange ideas on emerging materials trends and establish strategic partnerships.

He believes technology application and low-carbon transition will be key upgrade priorities for the ferrous metals industry. Under its National AI Strategy 2.0, Singapore is investing in computing power, talent, and industrial applications, and has established over 50 AI Centers of Excellence with industry partners.

In terms of application cases, global mining group Rio Tinto partnered with AI Singapore to develop AI tools to improve freight invoice processing and shorten transaction processing time for thousands of shipments.

On decarbonization, Chen Shenghui pointed out that Singapore, as a global maritime hub and host of the Global Maritime Decarbonization Centre, will continue to promote green shipping corridors and low-carbon alternative fuel testing.