European Union (EU) steelmakers saw sustainable growth of demand for 2008 and 2009 despite economic slowdown, according to a report released on Monday.

"Following the 2006/07 period of exceptional end-use strength, real steel consumption growth will slow down to a more sustainablerate in 2008 and 2009," the European Confederation of Iron and Steel Industries (Eurofer) said in its latest analysis of the European steel market.

The report said although the EU economy is slowing down, it has been able to keep its strength in the first months of 2008. Meanwhile, the business situation in the key steel using sectors in the EU remained healthy while most companies report strong order books, relatively high capacity utilization rates and difficulties in finding qualified personnel.

The current outlook showed 2.6 percent output growth in 2008, which represents a 0.4 percent downward reduction compared with the previous outlook, basically reflecting increased risks and uncertainties. Going into 2009, growth was seen developing in linewith industrial production growth at around 2 percent, according to the report.

"All in all, this bodes well for EU steel market conditions in 2008, particularly for the fist half of the year," said Eurofer, the Brussels-based industry body representing major EU steel producers such as ArcelorMittal and ThyssenKrupp.