According to the latest report issued by IREPAS, the global association for longs exporters and producers, the supply and demand situation in the global long steel industry is not getting any better amid increasing political influence on trade flows. This continues to put pressure on producers. The approaching year-end holiday season will contribute to a slowdown in the markets.
Looking at Turkish rebar exports, the biggest impact is the recent situation in Israel and now Yemen’s possible involvement, while EU demand is not improving and does not offer much hope to Turkish mills in the near future. Although demand remains weak in the EU, IREPAS sees some price improvement in the regional market from the lows of the summer due to the shortage of stocks.
In the US, demand seems to be slowing down for long products as most buyers are reluctant to purchase material that will arrive at the end of the year, in order to avoid year-end taxes. The US domestic market has seen some good news with UAW and auto producers reaching an agreement and returning to business, and unprecedented gains on flat products. The end of the UAW strike was one of the reasons behind the recent significant increase in HRC prices.
Imports to the US are on the decrease and mostly coming from two neighboring countries subject to zero Section 232 duty, making business more regional, such as in Europe. There are more protectionist measures being discussed, with the ineffectiveness of the WTO helping to make globalization history.
Meanwhile, in China, strong iron ore demand has been pushing up scrap prices, making it hard for steel mills to decrease prices. On the other hand, China has started raising its export prices, but whether the prices will hold is questionable.
IREPAS says that the current status of the market can be described as unstable for some regions and stable but at a low level for others. The outlook for the next quarter is pessimistic or quiet and sideways at best, but the long steel industry may see better times in the second quarter of 2024.