SAN FRANCISCO, Nov. 5, 2019 /PRNewswire/ -- The global steel service center market demand is expected to reach 755,191.3 kilotons by 2025, registering a CAGR of 3.5% over the forecast period, according to a new report by Grand View Research, Inc. High demand for steel products from construction and advanced manufacturing industries is likely to remain a prominent growth driver.
Increasing focus on advanced manufacturing sector coupled with investments in private and public constructions in countries, such as India, China, and U.S. is expected to drive the demand for steel and related products. Steel is one of the versatile materials and has various applications in biotechnology and new-energy vehicle sectors. Recently, China Construction Bank tied up with the National Development and Reform Commission to start an investment fund of around USD 47 billion in the industries such as biotechnology and new materials and vehicles. Also, as per China's state plan, the country aims to double the contribution from these sectors by 2020.
Key suggestions from the report:
- In terms of volume, heavy industry held the highest market share of 27.8% in 2018. Focus on increasing industrial output supported by government programs are the key driving factors
- Ground transportation segment is anticipated grow on the account of increasing sales of electric and hybrid vehicles. In 2018, this segment accounted for 97.725.5 kilotons of volume
- Asia Pacific is projected to lead the segment with highest market share of 66.7% in 2018. The growth in this region is characterized by presence huge manufacturing sector in developing economies including India and China
- In terms of volume, Europe is likely to expand at a CAGR of 3.3% during forecast period, owing to increasing R&D expenditure by the regional steel companies
- Some of the key market players include Tata Steel, Russel Metals, Reliance Steel & Aluminum Co, Samuel, Son & Co., thyssenkrupp Materials Processing Europe GmbH, and voestalpine Steel & Service Center GmbH among others
- Recently, many manufacturers have started establishing new steel service centers in North America through joint ventures and inorganic growth strategies. Imposition of steel tariffs by the U.S. government is a key factor driving the establishment of the new centers
Read 90 page research report with ToC on "Steel Service Centers Market Size, Share & Trends Analysis Report By Application (Metal Fabrication & Machine Shops, Heavy Industry, HVAC, Oil & Gas), By Region, And Segment Forecasts, 2019 - 2025: https://www.grandviewresearch.com/industry-analysis/steel-service-centers-market
Ground transportation segment accounted for market share of 15.6% in 2018. Challenges such as decreasing sales of vehicles are anticipated to create a negative impact on the steel service center market for a short term. Recently, many countries have observed a decline in sales of commercial and passenger vehicles. For instance, China witnessed more than 12% drop in the first six months of 2019. As per the China Association of Automotive Manufacturers, auto sales were down by 9.6% in June 2019 compared to the previous year.
Monetary reforms and new taxation policies to reduce the burden on companies in developing countries is a positive sign for steelmakers. In September 2019, India's Ministry of Finance announced reduction in corporate taxes, to ease the burden on the corporate sector. As per this announcement, the effective tax rate for the companies with taxable income greater than INR 1 crore has been reduced to 25.6% from 34.9% earlier. Also, to attract investors in domestic manufacturing, the companies incorporated after 1 October 2019 will have a tax rate of 15%. This was a key decision for the Indian manufacturing companies and is anticipated to create a positive impact in the long run.
Steelmakers in the market focus on the data due to the immense potential present in the sector. To meet the short lead times the companies have started utilizing the data associated with yield, real-time prices, costing, and tracking. Another trend observed in the market is the emergence of e-commerce platforms. The companies are integrating business information to keep up with increasing pace of online sales.
Grand View Research has segmented the global steel service center market based on application and region:
- Steel Service Center Application Outlook (Volume, Kilotons, 2014 - 2025)
- Metal Fabrication & Machine Shops
- Heavy Industry
- Consumer Appliances
- HVAC
- Food Processing & Agriculture
- Oil & Gas
- Ground Transportation
- Others
- Steel Service Center Regional Outlook (Volume, Kilotons, 2014 - 2025)
- North America
- U.S.
- Canada
- Mexico
- Europe
- Germany
- U.K.
- France
- Asia Pacific
- Japan
- China
- India
- Central & South America
- Brazil
- Middle East & Africa
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About Grand View Research
Grand View Research, U.S.-based market research and consulting company, provides syndicated as well as customized research reports and consulting services. Registered in California and headquartered in San Francisco, the company comprises over 425 analysts and consultants, adding more than 1200 market research reports to its vast database each year. These reports offer in-depth analysis on 46 industries across 25 major countries worldwide. With the help of an interactive market intelligence platform, Grand View Research helps Fortune 500 companies and renowned academic institutes understand the global and regional business environment and gauge the opportunities that lie ahead.
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