IREPAS: German buyers await further rebar price cuts, outlook generally gloomy in Europe

Speaking at the SteelOrbis 2012 Fall Conference & 67th IREPAS Meeting taking place in Munich on September 30-October 2, Wilhelm Alff from Stemcor AG said that the European long steel market in general is quite depressed resulting in a significant oversupply problem, given that rebar overcapacity in Spain reaches about 2.5 million metric tons excluding imports, while a similarly pessimistic outlook prevails in Italy. Accordingly, as Mr. Alff indicated, alternative markets are being sought for the surplus output volumes in question.
 
However, the Stemcor official also pointed out that the German economy is more stable and that an increase of about five percent is expected in its rebar consumption this year. Nevertheless, this is mostly because of replacement construction activities, rather than due to new projects, he added.
 
Remarking that the German long steel market witnessed a significant lull in activity levels throughout the second quarter of this year, Mr. Alff said that the market saw very intensive rebar booking activity towards mid-July, with rebar prices reaching all-time low levels due to stiff competition among local producers and also producers from other neighboring EU member countries ahead of the summer holidays. However, at the current time, as Mr. Alff told attendees at the SteelOrbis and IREPAS event, buyers are again sitting on the sidelines waiting for further price cuts.