Russia-Ukraine Conflict to have Huge Impact on Global Steel Demand

According to the head of a Japanese steel industry group, the conflict between Russia and Ukraine, two countries that are also major exporters of steel products, will have a huge impact on global steel demand and trade if the situation lasts for a long time.

Japan Iron and Steel Federation Chairman Eiji Hashimoto said in a news conference, “Even before the Russia-Ukraine war, we had faced three risk factors to dent the steel demand, China’s slowdown, global chip shortage, and soaring energy and natural resources prices.”

He further said that the recent plunge in yen against the US dollar is a serious challenge to Japanese manufacturers as some industries have still not overcome deflation pressure to pass on rising costs.

The former prime minister of Japan, Shinzo Abe came into power in 2012 ushered in bold policies known as “Abenomics” that helped to revive the economy along with boosting corporate profits and exports, as the yen sank to around 120 yen from 80 yen levels.

However, the recent depreciation of the yen has raised the cost for Japan Inc, which is already suffering from soaring energy and resource prices amid the global economic recovery from the pandemic recession and decarbonisation trends, Hashimoto said.