The situation as regards excess supply in certain areas of the global long steel products market remained the same in July as compared to June, according to the market outlook released by IREPAS, the global association of producers and exporters of long steel products. There have been price rises due to availability restrictions amid some closures, like in the EU region, or also due to pressure on the raw materials side, like in Asia. In some markets, supply has been reduced to some extent, balancing with a certain weakening observed in demand. With the exception of the US, where the movement is in the opposite, positive direction, demand in the overall global long steel market has not improved and is still weak.
Domestic demand in the US for ferrous scrap is also good, just like the situation in the Turkish market. The grain season in the Black Sea area has had a negative impact on scrap collection in the region, pushing deliveries under June contracts back until the end of July.
As mentioned in last month's press release from IREPAS, the long steel market may have already reached the bottom and is fluctuating with small ups and downs. There are indications of further production cuts, and small signs of restrictive selling by producers as well as some small signs of demand on the consumers' side. Increases have been observed in general in finished steel product prices. The prices of long products have moved upwards in the EU market, while the price of reinforcing bar has increased by almost $50/mt in Chinese domestic market.
Competition levels in the market are still very strong, putting all players under great pressure, as stated by IREPAS.
The association said in its outlook for August that the ongoing developments in Egypt, Syria and the MENA region in general, added to Ramadan and the holiday season, have contributed to a slowdown in the market. There are not a lot of expectations for change in August, but the outlook for September looks a bit more positive.