After a fragile recovery from pandemic during 2021 year, the world economy in 2022 is facing market conditions of a “perfect storm”. Geopolitical, market and financial volatility can generate unintended and unpredictable consequences, with Russia’s invasion of Ukraine and the West’s response providing a dramatic illustration of how combustible that combination can be.
The cable industry is heavily affected by actions of governments and businesses around the world. The impact of COVID-19 includes shortage of subcontractors and materials, supply chain disruptions, and the termination of contracts to control expenses. Recovering from the COVID-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in a number of serious operational challenges.
For now, cable makers, and not only them, have to operate under conditions of fast price increases of commodities and services. As result, the cost of producing cables has increased significantly, so they are forced to pass part or all of the additional cost to the consumers. The world cannot continue to absorb this type of escalation, so something has to happen, some actions need to be reinforced.
The best suggestion is this: The price increase and volatility of the market are going to be around for a while, before solving themselves. Until then, traders must adopt a flexible price adjustment mechanism.
Given the importance of the use of steel in a wide spectrum of economic activities, this research paper will be focused on providing an overview of current market conditions of steel and a short term forecast.