The level of construction activity throughout the country will be a key determinant of the fortunes of the structural steel industry in Australia, says a recent report from market research firm, IBISWorld.

The report documents how heightened activity in both the housing and non-housing sectors registered strong growth till 2008, providing the structural steel fabrication industry with strong opportunities to grow. But after the crisis, construction was effectively crippled, and though there has been some improvement since then, the situation is far from ideal.

IBISWorld industry analyst David Stephen notes that, “prior to the downturn, the industry was buoyed by robust activity in the non-residential construction industries, especially institutional buildings and public infrastructure works such as roads and bridges”.

As access to credit became more difficult there was a “dramatic decline in the number of housing starts in 2008-09”. Since then there have been many ups and downs in the situation all of which are documented in the report.  Domestic demand has been erratic, but is expected to continue its long-term upward trend. In the five years through 2011-12, industry revenue is expected to grow by 1.0% per annum to total $7.76 billion. This includes forecast growth of 1.5% during 2011-12.

The report posits that over the five years through 2016-17, the structural steel fabricating industry will make a steady recovery, as a result of improved economic conditions buoying construction activity, with non-residential construction being the key driver, closely followed by heavy industry and non-building construction. Prices, however, are expected to decline in this period.

IBIS World is headquartered in Melbourne, and is one of the most trusted independent sources of industry and market research in the country.