Automotive growth gives steel much needed good news

The global steel industry enters 2016 facing significant headwinds. A drop in domestic demand for steel in China, the world’s largest producer, has resulted in huge levels of oversupply, much of which has flooded foreign markets at cheap prices. In addition, low oil prices have hit demand for tubular goods used in oil production. US Steel, which as of 2014 was the world’s 15^th largest producer, announced at the start of the year that it would idle production at two tubular goods plants. In January 2016, the price of Brent crude hit a 13-year low when it dipped below US$30 a barrel.