Gold Safe-Haven Appeal and Global Steel Slowdown: Asia Still Provides Support
Forecasts for global steel demand growth have been sharply cut this year, putting short-term pressure on the ferrous metals industry. However, demand in Asian markets remains resilient and will provide medium- to long-term support for the sector, while Singapore is also expected to further cement its position as a ferrous metals trading hub.
Chen Shenghui, Minister of State for Trade and Industry and National Development, said at the opening ceremony of Singapore International Ferrous Metals Week that the forecast for 2026 global steel demand growth had been lowered from about 1.3% at the start of the year to 0.3% now, though the industry is expected to recover to around 2.2% growth in 2027.
Chen said the industry’s short-term pressures mainly come from three areas: supply chains, costs and trade policy. Conflict in the Middle East has disrupted supplies of feedstock such as direct reduced iron (DRI) and hot briquetted iron; higher energy and freight costs have further burdened companies; and changes in trade policy and tariffs continue to affect global steel trade flows.
Even so, Asian demand remains a key force supporting the industry outlook. In Southeast Asia, driven by urbanization, population growth and large-scale infrastructure development, long-term demand remains solid in steel-intensive sectors such as construction and manufacturing.
He also noted that India is emerging as a major growth market, with steel demand expected to rise by about 7% in 2026 and growth potentially accelerating further in 2027.
Singapore strengthens its role as a ferrous metals trading and safe-haven hub
Chen said Singapore is one of the world’s major ferrous metals trading hubs, hosting more than 60 miners and major firms across the value chain, including global traders. Ferrous metals mainly refer to iron- and steel-containing metals; common categories include iron ore, steel, pig iron, scrap steel and ferroalloys.
In addition, the Singapore Exchange is the largest seaborne iron ore derivatives exchange outside China, with trading volumes far exceeding the physical market. Its trading mechanisms help companies hedge risk in real time when markets are volatile.
He stressed that Singapore has trading talent, shipping connectivity, trade finance and a rules-based legal system. These conditions allow firms to execute contracts, manage risk and adjust trade routes more flexibly when supply chains are disrupted.
Green metals forum makes debut
This year, Singapore International Ferrous Metals Week added the Singapore New Energy Metals and Materials Forum for the first time. The forum is co-organized by Green Esteel, a steel company focused on green and low-carbon development, and Shanghai Metals Market.
Chen said the forum will bring together global industry players to exchange views on trends in emerging materials and build strategic partnerships.
He added that technology adoption and low-carbon transformation will be key priorities for upgrading the ferrous metals industry. Under Singapore’s National AI Strategy 2.0, the country is investing in computing power, talent and industry applications, and has already set up more than 50 AI Centres of Excellence with industry partners.
On decarbonization, Chen said Singapore, as a global maritime hub and home to the Global Centre for Maritime Decarbonisation, will continue to promote green shipping corridors and trials of low-carbon alternative fuels.
