BMI View: The fortunes of Poland's steel and copper sub-sectors are likely to diverge over the next fewyears as robust growth in steel production levels contrasts with sluggish expansion in copper output. Theexpansion in domestic autos production and construction activity will provide much of the drive for steelconsumption and output, which, in contrasts, Polish copper producers appear to be shifting productionincreasingly overseas.
We expect the steel industry to be the main driver of growth in Poland's metals sector over 2015 and beyondas a steady rise in domestic consumption generates reliable demand for local steel mills. Data from theWorld Steel Organisation shows Poland's steel output to have grown by about 11% year-on-year (y-o-y)during the first four months of 2015 and we expect this momentum to carry through the coming quarters. Arobust Polish economy will provide an important platform for growth in steel demand through the comingmonths, with GDP expected to expand by 3.5% in 2015, one of the fastest rates of growth within the EU.
Within this picture, we see the autos sector to remain important drivers of steel consumption as consumerspending increases and overseas manufacturers take advantage of lower Polish labour costs. Infrastructurewill also be a primary growth driver, with an EU-funded EUR17.5bn investment programme supportingincreased levels of steel usage.
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