The global bulk ferroalloys market is anticipated to land at a worth equivalent to ~US$ 79 Bn by 2027, as two particular sections control development: expanding open doors for ferroalloys in development exercises over the globe and the utilization of steel to encourage advancements in car plans. New open door is made for bulk ferroalloy producers with the presentation of the Paris Agreement in regards to the jolt of vehicles by 2030. Since automakers look for lightweight materials to improve the eco-friendliness of vehicles, the interest for steel is anticipated to escalate during the period of 2019-2027.
However, the depletion of reserves is bound to pose a serious challenge for the future production of these alloys. As the availability of raw materials for the ferroalloys industry is inadequate in numerous countries, the industry is highly reliant on imports, which is likely to influence the price of bulk ferroalloys during the forecast period. The high cost of producing bulk ferroalloys is yet another concern for manufacturers. Power requirements for the production of bulk ferroalloys are ~35%-40% of the total overhead cost, given the volatility in the prices of coking coal and electricity. Owing to the high cost of power generation, ferroalloy plants fails to utilize their full capacity, and this surges the prices of the end products.
- Manufacturers Look at Asia Pacific as a Region with Measurable Growth Opportunities
As per the TMR study data for 2018, Asia Pacific accounted for ~57% of the market share, and will continue to remain relevant during the forecast period, given its favorable geographic location, coupled with the lead of China, India, and Japan in the production of steel. Propitious demand-supply dynamics in the steel industry in India, including the permission for 100% foreign direct investment (FDI) in the mining sector and high budget allocation to infrastructural activities, are projected to augur well for the regional market.
Besides construction, the bulk ferroalloys market also remains benefitted from the growth of the automotive sector of Asia Pacific, which enhances its lucrative quo. For instance, in October 2018, Mitsubishi Motors announced its plan to raise the production capacity of its steel plant, located at Bekasi, from 160,000 units to 220,000 units, annually, by 2020.