Traders at IREPAS: Oversupply prevails in steel industry

During the SteelOrbis Spring 2014 Conference and 70th IREPAS Meeting held in Barcelona, the traders committee evaluated the market situation stating that the supply-demand imbalance still exists and will continue in the short to medium term, despite quite low capacity utilization levels in Europe, especially in southern Europe. The traders remarked that in China, although some outdated capacities are being closed for environmental purposes, they are being replaced by larger and more advanced mills.
 
Regarding the ongoing antidumping duty cases in the US in relation to Turkish and Mexican rebar, mixed opinions were expressed by traders, with no significant margin anticipated for Turkish rebar suppliers. Traders believe that protectionist practices will continue to be adopted.
 
Traders also looked at the steel market situation in Algeria, where long steel imports are foreseen to decline with the commissioning of new capacities, including the new rebar mill of Turkish steel group Tosyali, which began production June 2013. Lower long steel demand in this country will affect Spanish and Italian rebar suppliers negatively, as Algeria is the main export market for southern European long steel mills.
 
Traders also discussed the role of trading companies in a new world where media and information technologies no longer provide any opportunity for traders to act faster than other players in the market. The general opinion is that steel traders are suffering from very slim margins and that they should offer added value in order to survive.