Raw Material Suppliers at IREPAS: Rise in Chinese exports will alter existing market balance

Speaking at the SteelOrbis 2014 Fall Conference & 71st IREPAS Meeting in Berlin, Ioannis Meimaroglou from Helveco Intertrade, the chairman of the raw materials suppliers committee, stated that the increasing volume of exports from China due to the slowdown of Chinese domestic consumption is influencing the world market and will certainly change the existing steel trade balances.
 
Mr. Meimaroglou said that the some members of the raw materials committee expressed the view that the threat of cheap Chinese steel exports is being used more as a pretext to exert downward pressure on raw material prices, while others stated that, if Chinese exports reach 100-120 million mt annually, the consequences will be serious, independently of whether these exports are directed to Turkey or to other countries.
 
"The increasing raw material demand in the market in the Arabian peninsula is creating a new situation in the region and can change the correlations on a more permanent and long-term basis," said Mr. Meimaroglou. He went on to say that the considerable fall in iron ore prices has been increasing the pressure on scrap prices, adding that the strengthening of the US dollar is helping raw material suppliers for the time being, covering a part of the price fall.
 
Regarding scrap collection, Meimaroglou stated that the domestic markets in the US, Europe and Russia are very strong and healthy and so it is difficult to compete with them in order to collect material for export, leaving most scrap yards almost empty.
 
He concluded by saying that the raw material market is likely to see further pressure on prices, drastically affecting suppliers' quantities, while also adding that the direction of scrap flow may change in the future.