Global manufacturing was in the doldrums for much of last year, pulled down by weak demand in key consumer-driven segments amid ongoing trade tensions and slower economic growth.
Countries such as Japan, South Korea and Germany that rely on exports found it tougher to sell to overseas customers, while the downturn in auto sales in the United States exemplified what was happening to the sector internationally. When the coronavirus outbreak hit in early 2020, it was akin to kicking manufacturing when it was already down.
While the full weight of COVID-19 hit the manufacturing sector in April, with many countries around the world in lockdown, China was already starting to get back on its feet.
Manufacturing activity in Japan, Europe and the US slumped to depths last seen during the global financial crisis of 2008-2009; Indian manufacturing fell to a 15-year low. In China, the manufacturing purchasing managers’ index published by the National Bureau of Statistics softened slightly in April compared with March but indicated the sector was still growing.
Prices of hot-rolled coil, or HRC – the core steel product used in manufacturing –were already drifting down in major markets before COVID-19, due to tepid demand from the sector. S&P Global Platts assessments show that between the start of last year and end of April this year, US HRC prices fell by 30%, European HRC prices by 16% and China’s by 15%.
