According to the market outlook released by IREPAS, the international rebar producers and exporters association, at a global level demand is stable at healthy level except in Europe. There is still over supply versus apparent demand in the market but mills continue to keep a good discipline in terms of adapting supply to market conditions, also in the EU. The situation is expected to get better, as reduction in supply in line with demand is seen in certain areas.
There seems to be a balance between the supply and demand in the international ferrous scrap market which brings stability to the market pricewise. Demand in the US domestic scrap market is also stable and helps to keep scrap export prices from US ports firm. Turkish demand for scrap is healthy and Turkish mills continue to consume the same amount of scrap steadily every month.
Markets in emerging economies are keeping good momentum and the situation in markets like the USA, Japan and Germany are slowly improving. Oil producing nations possess healthy economical situation and better demand. The Turkish and Iraqi markets continued to gain strength. North American market is also quite firm. The Middle Eastern and North African markets have been picking up on the back of investments as political unrest in the region is calming down. Other good news for the global market is that; the weakening in Chinese and Asian markets has come to an end.
The international finance picture is getting clearer. The liquidity in the market, low interest rates and lower freight rates are other positive factors for the international market.
Competition in the market is still tough especially in reinforcing bars as there is always capacity ready to take a part of emerging opportunities, but always within economic common sense.
Under current circumstances the market can be described as generally stable in certain areas, dynamic in others. However the producers are under great pressure because of raw material costs.
Outlook for May
The market is expected to be satisfactory in emerging areas and developing markets, and generally stable in the EU. There is a degree of uncertainty in some markets due to seasonal demand fluctuations.
Raw material costs will continue to play an important role in the market. Since the long products are regionally produced via different routes, the market may experience changes in flows and pricing based on the changes in the raw material costs.
Ferrous scrap market is expected to trend sideways. Ramadan and European holidays coincide this year and consequences remain to be seen on the scrap demand and supply.