Despite three lockdowns over the past year, the UK’s steel industry is still expected to see an increase in its sales. Mostly, they’ve been among the least affected by the pandemic as stated by credible market sources. The steelworks industry is expected to continue its operations as most, if not all, manufacturing sites will keep their doors open. The manufacturing of steelworks, such as for scaffolding hire in Auckland, is deemed essential.
Sectors such as the automotive industry could suffer drastically since closures are in effect. These have been some of the hardest-hit during the pandemic. This comes from S&P Global Platts who’ve managed to secure all the details in the matter.
Status Quo for the Steel Industry
According to a leading spokesman from Tata Steel, the steel industry continues to be up and running so there are no impacts on their sales departments. He went on to further suggest that most of the changes in the nation do not actively affect them since they’ve been following some of the strictest guidelines.
According to Gareth Stace, the general director of the steel sector in the UK, most companies in the steel industry are expected to function as normal even amid the third lockdown. However, they were made to follow strict COVID-19 protocols. Further statements made suggest that the industry was indeed ready to land a helping hand to the Government if need be.
In lights of this, they continue to suggest that they’re willing and ready to meet the demands of the public. However, some of these demands include the need for skilled personnel and even better production lines. They’ve even prepared themselves to deal with the supply of specially crafted materials.
Protection from the Virus
Experts draw light on the fact that they’ve made it through the first two lockdowns successfully. Over three thousand workers in the steel industry alone were protected from any adverse implications that came from the virus. According to the UK’s annual statement, the industry is responsible for producing up to 7.3 million metric tons of steel annually. In essence, they actively supply up to 65% of the required amount for the UK.
However, it should be noted that most consumers are expected to suspend their purchasing needs since the third lockdown is only in place for a finite period. As such, persons will simply cancel plans and reschedule them at later dates as stated by the Financial Times. A local London-based broker Pierre Veyret also suggest a similar insight into the industry.
Veyret went on to indicate that any increase in the equity market at the end of 2020 would have been due to the presidential elections in the US. He went on to state that this may be the sign that investors were anticipating. However, this may have been the ideal sign since measures were put in place by the European nation.
Growth Expected for the Sector
The sell-off prices were also thought of as being more attractive for all investors. This came because most of them were already expecting special pricing recovery. However, a revised down estimate from the Q4s indicated that the UK would experience some growth. Hence, some yearly contractions of up to 10.5% can be expected.
Even with these rates, recovery should be expected by 2023. This comes due to the no-deal with Brexit.
End of Brexit Transition
While the steel sector is somewhat concerned by the implications, they’ve managed to see a plunge in the need for domestic steel. Hence, a 22% decrease in demand is expected because of the pandemic. The director of the steel association indicated that they still expect some form of recovery but fear that it may take a turn for the worse as things reverse.
With that said, the government should still be ready to lend a helping hand to those in need. Stimulus efforts should be put in place to meet the demands of the business community. Besides the pandemic, most are just hoping for when they can leave the EU.