Progression and Forecasting of Steel Demand in Kenya

Abstract

Increase in usage of steel in Kenya has been witnessed due to the immense growth in the industrial sector and infrastructure. It is quite evident that as the country transforms herself into a middle income economy, it shall continue to invest heavily in infrastructure and thus steel usage shall with no doubt continue to rise. This paper seeks to forecast steel demand and supply in Kenya till 2030. Time-series model is used to carry out the forecast particularly moving averages and trend projection methods being employed. The results project an increase in steel demand from 1.6 million tons in 2014 to 2.7 million tons by 2020 and 4.4 million tons by 2030. Also, of the 1.2 million tons’ net imports in 2014, 704,000 tons were hot-rolled coils (HRC) a value which was projected to rise to 2.5 million tons HRC by 2020 and 3.6 million tons by 2030 signifying a massive investment opportunity in this area. This paper established that with the country investing in this opportunity, it would have a market of about 1 million tons to serve by 2018.