Wire Rod Market Research Report and Outlook by 2028

The wire rod market is projected to expand from US$ 1,621.27 million in 2022 to US$ 1,965.21 million by 2028, reflecting a compound annual growth rate (CAGR) of 3.3% from 2023 to 2028.

Robust economic conditions in regions such as North America, Asia Pacific, and the Middle East & Africa are driving an increase in construction activities. In contrast, Europe has experienced a more moderate growth in construction, although a well-established construction sector in several countries has facilitated improved spending on residential and infrastructure projects. Data from Oxford Economics and Haver Analytics indicates that from 2020 to 2030, China, India, and the United States will be significant contributors to residential construction efforts. Marsh LLC reports that residential construction surged in 2021, achieving a growth rate of 7.1%. Notably, the residential sector represented 44% of total global construction in 2020, making it the largest segment. Wire rods play a crucial role in construction, serving various functions such as facilitating electricity transmission, data transfer, voice communication, and security systems. Consequently, the uptick in construction activities is propelling the demand for wire rods, thus fostering the wire rod market growth.

Wire rods are essential for high-voltage overhead transmission lines and are instrumental in linking power grids to various end users, including industrial, residential, and commercial sectors. For example, in the Asia Pacific region, investments in the power and energy sector are on the rise due to increasing electricity demand. In February 2023, the Indian government sanctioned an investment of US$ 3.9 billion (Rs. 319 billion) for the 2,880-megawatt Dibang hydropower project in Arunachal Pradesh. Similarly, in September 2022, the New South Wales government approved EnergyConnect, the largest transmission project in Australia, which aims to deliver more affordable renewable energy to the power grid. Therefore, the escalating investments in the power sector are anticipated to enhance the growth of the wire rod market in the Asia Pacific region throughout the forecast period.

Effects of the COVID-19 Pandemic on the Wire Rod Market

The United States was significantly impacted by the COVID-19 pandemic, particularly in North America. In the second quarter of 2020, stringent regulations imposed by the US government disrupted supply chains and hindered import and export activities. This disruption resulted in temporary shutdowns of manufacturing facilities, which operated with minimal staff. Industries such as automotive and manufacturing faced considerable challenges in 2020. However, as the global supply chain began to recover in the second quarter of 2021, the wire rod market began to rebound. The automotive sector, one of the largest in the US, resumed operations in the third quarter of 2021. Furthermore, in the first quarter of 2022, automobile manufacturers ramped up production in response to rising demand for various vehicles, especially electric vehicles. Additionally, the growing emphasis on clean energy in the US, Canada, and Mexico has spurred demand for renewable energy infrastructure, further driving the growth of the wire rod market.

In addition to the factors mentioned, the semiconductor industry faced significant challenges in the region. The chip shortage highlighted the US's reliance on Asian high-tech manufacturing capabilities, particularly from countries like China, which is heavily investing in its chipmaking infrastructure. Taiwan, China, and Malaysia are key sources for US semiconductor imports and major destinations for US semiconductor exports. East and Southeast Asia are crucial partners in the US semiconductor trade. According to Intel Corporation, the chip shortage persisted through 2021 and 2022, with expectations of improvement in 2023. This situation has created a substantial gap between demand and supply for chips in the US market.

The overall size of the wire rod market has been determined through a combination of primary and secondary research methods. The research process commenced with extensive secondary research utilizing both internal and external sources to gather qualitative and quantitative data related to the wire rod market. This approach also aimed to provide an overview and forecast of the wire rod market size across all segments. Additionally, numerous primary interviews were conducted with industry stakeholders to validate the findings and gain deeper analytical insights. Participants in this process included vice presidents, business development managers, market intelligence managers, and national sales managers, as well as external consultants such as valuation experts, research analysts, and key opinion leaders specializing in the wire rod market.