Prediction model of global demand for iron source by utility of stock hypothesis-verification of predictive power and outlook for demand to 2050

Abstract

The Utility of Stock hypothesis, which assumes that an in-use stock of constructional material is a function of GDP, was formulated and a clear correlation between the world steel stock and the world GDP led to the estimation that the world demand for iron ore (primary iron) depends not on the volume of GDP but on the variation of GDP, as already reported. It also became clear that the flow of primary iron has the controlling effect on the world production of crude steel. In this study, the predictive power of the Utility of Stock hypothesis is verified. Based on the verification, the global demand for iron source until 2050 is projected by deciding a world 1-region model. © 2010 ISIJ.