CHICAGO | Louis Schorsch, president and chief executive officer of ArcelorMittal North America, said his company plans to grow 20 percent by 2012 as the demand for steel continues in the world's emerging economies.

"Our market is driven by what's happening on the other side of the world," he said during a keynote speech Friday at the CRU North American Steel Conference.

The United States formerly drove the world economy, but "it will never be that way again," he said. "The fundamentals have fundamentally changed."

But Schorsch said he's "bullish" about the global steel market because of the growing demand from developing economies of Brazil, China, India and Russia that started at the beginning of the century and continues unabated.

"There's no prospect for a global slowdown," Schorsch said. "Emerging markets will drive global growth."

Their investment will account for 65 percent of steel consumption in 2008 and into the next decade, he said.

Schorsch also noted that steel industry consolidation has added the potential for stability in the market.

"It gives us flexibility as a large company," Schorsch said, pointing to ArcelorMittal's 25 percent to 30 percent of market share, which he contends gives it better capacity utilization, economies of scale, market influence and the ability to produce at the correct level for market conditions.

The company's more than 138 million tons of worldwide steel production capacity gives it the ability to improve its operating rates and have better profit margins throughout all phases of the economic cycle, he said.

Yet, steel prices remain volatile and steel multiples are significantly discounted because investors are unsure of the industry's sustainability.

"We have to be more savvy in how our market fits into the world environment," Schorsch said. "We still have a fair amount of work to do."

He predicts the domestic steel market will pick up from its current level because steel service center inventories are at a three-month level, original equipment manufacturer inventory levels are reasonable, the underlying domestic market demand is relatively stable, and the prices of metallics and iron ore have sharply risen, putting pressure on global price levels.

Plus, imports are down "significantly" and should remain low, because of a surge in shipping costs and regional price differentials, Schorsch said.

"The balanced global portfolio of ArcelorMittal enables us to generate growth with more stable earnings," he said. "Going forward, it's a path many of our competitors will be following."

Locally, ArcelorMittal has two plants in East Chicago and another in Burns Harbor.