EUROFER expects steel imports into EU to rise 12.5 percent in 2010

Tuesday, 09 February 2010 15:50:26 (GMT+2)

According to the "Economic and Steel Market Outlook 2010-2011" report released by the European Confederation of Iron and Steel Industries (EUROFER), in the third quarter of 2009 third country steel imports into the EU declined by almost 60 percent compared with the same period of 2008. This resulted in steel import volumes hitting the lowest level seen in recent years in a reflection of overall weak demand and pricing conditions in Europe.

Moreover, under the current market conditions which are still far from being transparent, steel buyers are biased towards ordering essentially on a hand-to-mouth basis. This has led to a reluctance to engage in more substantial deals with third country suppliers with potentially longer delivery times.

In the final quarter of 2009, the year-on-year reduction in steel imports is estimated to have diminished to approximately 37 percent, with imports rising almost 22 percent quarter on quarter. This rise had already been signaled by the mild increase in import license applications during the third quarter.

On balance, third country steel imports are estimated to have fallen by 47 percent in the whole of 2009.

The outlook for 2010 is for the declining trend in imports registered in 2008 and 2009 to see a reversal. Third country steel imports are foreseen to rise again by 12.5 percent in 2010 and by a further 12 percent in 2011, more or less in line with the projected growth in apparent steel consumption. This assumption is based on a global steel market development in which supply and demand are reasonably balanced.

Nevertheless, the import situation remains a major issue of concern. So far, rising global steel production has not yet resulted in a significant increase in imports into Europe. However, if global demand fails to follow the rising trend in steel output, temporary oversupply elsewhere could lead to import pressure building up in the EU more strongly than currently projected.

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