Singapore Ferrous Trading Hub: Slower Steel Demand Growth Still Supported
Global expectations for steel demand growth have been cut sharply this year, putting short-term pressure on the ferrous metals industry. However, demand in Asian markets remains resilient and will support the industry in the medium to long term, while Singapore is also expected to further cement its position as a ferrous metals trading hub.
At the opening of Singapore International Ferrous Week, Chen Shenghui, Minister of State at the Ministry of Trade and Industry and the Ministry of National Development, said the forecast for global steel demand growth in 2026 has been lowered from about 1.3% at the start of the year to 0.3% now, but is expected to rebound to about 2.2% in 2027.
Chen said the industry's current short-term pressures mainly come from three areas: supply chains, costs and trade policy. The conflict in the Middle East has disrupted supplies of raw materials such as direct reduced iron (DRI) and hot briquetted iron; rising energy and freight costs have further burdened companies; and trade policy and tariff changes continue to affect global steel trade flows.
Even so, Asian demand remains the key force supporting the industry's outlook. In Southeast Asia, urbanization, population growth and large-scale infrastructure development are driving long-term demand in steel-intensive sectors such as construction and manufacturing.
In addition, India is becoming a major growth market, with steel demand expected to rise about 7% in 2026 and growth likely to improve further in 2027.
Singapore strengthens its role as a ferrous trading and hedging hub
Chen said Singapore is one of the world's major ferrous metals trading hubs, home to more than 60 miners, global traders and other major companies across the value chain. Ferrous metals mainly refer to iron- and steel-based metals, with common categories including iron ore, steel products, pig iron, scrap steel and ferroalloys.
He said the Singapore Exchange is the largest seaborne iron ore derivatives exchange outside China, and its trading volume far exceeds the physical market, helping 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 companies to enforce contracts, manage risk and adjust trade routes more flexibly when supply chains are disrupted.
Green metals forum debuts: low-carbon transition and technology adoption
A Singapore New Energy Metals and Materials Forum was added to Singapore International Ferrous Week this year for the first time, co-hosted by Green Esteel and Shanghai Metals Market.
Chen said the forum will bring global industry players together to exchange views on emerging material trends and build strategic partnerships.
He noted that technology adoption and the low-carbon transition will be key priorities for upgrading the ferrous metals industry. Under Singapore's Artificial Intelligence Strategy 2.0, the country is investing in compute, talent and industry applications, and has set up more than 50 AI excellence centers with industry partners.
He cited an example in which Rio Tinto worked with AI Singapore to develop AI tools that improve freight invoice processing and shorten transaction handling time for thousands of shipments.
On decarbonization, Chen said Singapore, as a global maritime hub and home to the Global Centre for Maritime Decarbonisation, will continue to push green shipping corridors and testing of low-carbon alternative fuels.
