Alvin Tan: Global Steel Demand Growth Slows, But Asia Provides Support

Global steel demand growth forecasts have been sharply cut 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 well-positioned to further cement its role as a ferrous metals trading hub.

Minister of State for Trade and Industry and National Development Alvin Tan said at the opening of Singapore International Ferrous Week that the 2026 global steel demand growth forecast has been revised down from about 1.3% earlier this year to 0.3%, but the industry expects a rebound to about 2.2% in 2027.

Tan noted that short-term pressures come from three areas: supply chains, costs, and trade policy. The Middle East conflict has disrupted supply of raw materials like Direct Reduced Iron (DRI) and Hot Briquetted Iron; rising energy and freight costs add to the burden; and trade policies and tariffs continue to affect global steel trade flows.

Despite this, Asian demand remains a key support for the industry outlook. Southeast Asia, driven by urbanization, population growth, and large-scale infrastructure projects, still has long-term demand from steel-intensive sectors like construction and manufacturing.

Notably, India is emerging as a major growth market, with steel demand expected to grow about 7% in 2026 and potentially accelerate further in 2027.

Singapore Strengthens Role as Ferrous Metals Trading and Hedging Hub

Tan said Singapore is currently a major global ferrous metals trading hub, hosting over 60 mining companies, global traders, and other key players in the value chain. Ferrous metals primarily refer to iron- and steel-based metals, including iron ore, steel, pig iron, scrap steel, and ferroalloys.

In addition, the Singapore Exchange (SGX) is the largest seaborne iron ore derivatives exchange outside China, with trading volumes far exceeding the physical market, helping companies hedge risks in real time amid market volatility.

He emphasized that Singapore offers trading talent, shipping connectivity, trade finance, and a rules-based legal system. These conditions allow companies to execute contracts, manage risk, and flexibly adjust trade routes when supply chains are disrupted.

Green Metals Forum Debuts: Technology and Low-Carbon Transition as Focus

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

Tan said the forum will bring together global players to exchange views on emerging materials trends and build strategic partnerships.

He pointed out that technology adoption and low-carbon transition will be key to upgrading the ferrous metals industry. Under the National AI Strategy 2.0, Singapore invests in computing power, talent, and industrial applications, and has established over 50 AI Centers of Excellence with industry partners.

He cited an example: global mining giant Rio Tinto is collaborating with AI Singapore to develop AI tools to improve freight invoice processing and shorten transaction processing times for thousands of shipments.

On decarbonization, Tan said that as a global maritime hub and the home of the Global Centre for Maritime Decarbonisation, Singapore will continue to promote green shipping corridors and low-carbon alternative fuel testing.