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Presentation

Silver linings beyond 2019Developments and outlook for key steel-related industries

25 March 2019

Samuel Champanhet, Senior Principal Economist, Comparative Industry Servicesamuel.champanhet@ihsmarkit.com

Hossam Abougabal, Senior Research Analyst, Global Construction Servicehossam.abougabal@ihsmarkit.com

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Key messages

• A slowdown in 2019

• A stabilization over the short term

• Still strong fundamentals over the long term

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Operating conditions at global steel users are deteriorating

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Steel Sales by

Client Industries

Country: Belgium - Concept: VAR - Year: 2016 (Baseline)

Source: IHS Markit © 2019 IHS Markit

Steel manufacturing, gross output by client industries

Construction is by far the main buyer

1. Construction (around 50%)

2. Machinery & equipment (around 20%)

3. Motor vehicles (around 10%)

4. Other transportation equipment (Rail & Ships, around 5%)

• Fabricated metal products (including furniture, consumer goods, weapons) (remaining 15%)

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CONSTRUCTION

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Growth is expected to plateau

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Urbanization will support construction over the long term

USA

China

India

UK

Canada

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Industrial machinery

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Growth down by a full percentage point over the short term

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Automation to support spending on heavy machinery

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Motor Vehicles

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2019 an off-year for the automotive sector

-1.1

0.4

1.8

3.02.7

-3

-2

-1

0

1

2

3

4

2018 2019 2020 2021 2022China (mainland) United States Japan GermanyIndia South Korea Mexico FranceBrazil Other countries Vehicle production

Vehicle production growth contribution by country

Source: IHS Markit © 2019 IHS Markit

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Car parc stabilizing in advanced economies, still growing in the rest of the world

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RAILROAD EQUIPMENT & SHIPBUILDING

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China supporting railroad, excess supply in shipbuilding

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Trade growth to keep supporting demand for railroad equipment and ships

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THANK YOU

Q&A

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