There were 96 representatives from 36 different producers among the 302 registered delegates from a total of 41 different countries. There were also 75 registrations representing 43 different raw material suppliers.

At the opening of the conference, Ioannis Manessis, chairman of IREPAS, stated that the global steel industry is operating in an increasingly challenging environment characterized by geopolitical conflicts, shifting trade flows, higher costs and relatively weak demand. According to the IREPAS chairman, the deteriorating situations in the Black Sea and Iran are having a significant impact on steel markets and international trade. Damage to ports and vessels’ reluctance to sail have made trade in the Black Sea extremely difficult, while attacks on bulk carriers and oil tankers have also created significant challenges for trade in the Middle East.

Against this backdrop, energy prices, including oil, natural gas and coal prices, have increased, in some cases significantly. Manessis noted that these increases are raising costs for steel producers, scrap suppliers and shipping companies, affecting the entire steel value chain.

At the same time, the industry is facing an increasingly restrictive global trade environment. The IREPAS chairman highlighted the EU’s Carbon Border Adjustment Mechanism (CBAM) and its safeguard measures implemented after July 1, US tariffs, scrap trade restrictions in around 40 countries worldwide and other trade measures affecting steel markets. He also pointed to China’s recent efforts to prevent its steel industry from offering products at excessively low or loss-making prices, stating that these measures already appear to be having an impact on the market.

Meanwhile, higher interest rates are putting additional pressure on consumers as authorities seek to contain inflation. Manessis stated that, apart from demand related to the expansion of artificial intelligence data centers, global demand for steel products remains relatively weak.

According to the IREPAS chairman, demand is therefore not currently determining the direction of the market, with rising costs instead becoming the key factor. As a result, steel prices are increasing in almost all markets despite weak demand. Manessis added that, although the current environment remains difficult to navigate, higher prices are allowing trade to continue and creating opportunities for market participants.

On the last day of the conference, producers of long steel products, as well as traders and raw material suppliers, shared the conclusions reached at their special committee meetings regarding the current situation in the markets with the general participants at the event.

Producers at IREPAS: Trade barriers and overcapacity are fragmenting global steel markets

Steel producers remain cautiously optimistic despite challenging international trade conditions, while energy and raw material costs are expected to continue putting pressure on mills at least through the end of the winter, according to Alex Gordienko, export director at Spain’s CELSA Group, speaking on behalf of the producers committee.

Mr. Gordienko said that regions face different challenges, with European producers particularly affected by energy-related issues. Nevertheless, producers continue to see underlying domestic demand and remain somewhat more optimistic than current market conditions might suggest.

India expected to remain focused on domestic market

Commenting on the rise in Indian steel demand and the decline in the country’s export activity, Gordienko pointed to significant infrastructure investments and rapidly growing construction demand, while India’s steel production capacity is also increasing. He said he expects India to remain primarily focused on its domestic market over the next five years.

Regarding Southeast Asian suppliers, Gordienko said they will remain competitive internationally, though increasingly selective about their target markets. Their presence is expected to remain significant in the MENA region, while access to the EU will be more difficult due to quota restrictions.

EU needs favorable investment conditions as well as trade protection

Turning to Europe, Gordienko said there is significant potential demand from housing, electricity generation, data centers and defense investments, as well as the replacement of aging infrastructure. However, bureaucratic barriers are preventing these needs from translating into actual construction and investment.

According to Gordienko, the EU has become increasingly effective at protecting its steel market, but less successful in creating economic conditions that make steel production and investment attractive. Safeguards and the Carbon Border Adjustment Mechanism (CBAM) provide some protection, but cannot compensate for issues such as insufficient or expensive energy supply.

Overcapacity and trade barriers to fragment global markets

Addressing global overcapacity, Gordienko said governments increasingly want to preserve domestic steelmaking capacity even when mills struggle to generate profits, while new capacity continues to emerge in several regions.

He said he sees no realistic global mechanism capable of effectively regulating excess capacity. As trade barriers increase, surplus steel will have access to fewer export destinations, increasing the pressure on markets that remain open. At the same time, protected markets could experience temporary shortages and price increases despite substantial global excess capacity.

Gordienko said fragmentation is also changing the traditional steel market cycle. Instead of one broadly synchronized global cycle, individual regions are increasingly likely to follow their own cycles as trade barriers, domestic policies and local market conditions gain importance.

Looking ahead to 2027, he identified fragmentation as a key issue, encompassing overcapacity, Chinese exports and growing trade barriers, with market participants increasingly needing to focus on developments in their own domestic markets.

Traders at IREPAS: Trade barriers and freight risks make steel trade more regional

F.D. Baysal, chairman and CEO of SEBA Group of Companies and chairman of the traders committee, shared the committee’s assessment of current market conditions, highlighting weakening demand, regulatory pressures and rising geopolitical risks.

Mr. Baysal stated that steel trade is becoming more regional as tariffs, freight risks and additional import requirements complicate transactions. Presenting the findings of the IREPAS traders committee, Baysal said China had reduced steel production but continued to export large volumes. He stated that export licensing and VAT-related changes had altered the composition of its exports, with a greater share of long products. Continued weakness in China’s real estate sector has left surplus production seeking overseas markets, he added.

Freight risks complicate steel trade in Middle East

Baysal described freight conditions as volatile, stating that shipping from Asia to Europe has remained relatively soft, while finding vessels for shipments to and from the Middle East has become difficult. War-risk premiums and higher bunker costs have added to the challenges faced by traders.

Regarding trade in the GCC region, Baysal said decisions can no longer be based solely on the price of steel and its shipping cost. Traders must also consider insurance, changing transit times and uncertainty over whether cargoes will arrive as planned. He stated that he expects logistics to remain a significant issue. Baysal said geopolitical freight premiums are not necessarily permanent. What has changed more durably, in his view, is the need to account for geopolitical risks in every transaction. Shipping routes, additional premiums and the working capital tied up in delayed cargoes have become part of traders’ calculations.

High interest rates weigh on US steel demand

Baysal pointed out that higher interest rates are weighing on US commercial and residential construction and on demand for steel products used in those sectors. However, infrastructure, data centers, energy projects and manufacturing investment continue to consume steel. He noted that large infrastructure and data center projects are supplied mainly by domestic mills.

Against this background, Baysal said traders favor disciplined purchasing and low inventories. Back-to-back transactions are more attractive than speculative stockholding when financing is expensive and tariffs, quotas, freight and regional market conditions can change.

Capacity-demand gap and trade measures seen as interconnected risks

Although steel remains a cyclical industry, Baysal said its underlying trade structure has changed. Capacity growth, trade barriers and geopolitical risks have fragmented the market, requiring traders to identify opportunities in individual regions rather than rely on price differences alone.

Looking ahead to 2027, he described the gap between steel capacity and demand, and the trade measures that may result from it, as interconnected risks.

Raw Material Suppliers at IREPAS: Rising costs and trade barriers put pressure on raw material flows

Jens Björkman from Stena Metal International and chairman of the raw material suppliers committee shared the committee’s assessments of current dynamics and difficulties in global raw material markets during a panel session.

Mr. Björkman stated that higher freight, energy and financing costs, together with potential restrictions on scrap exports, are putting pressure on the steelmaking raw material trade. Presenting the findings of the IREPAS raw material suppliers committee, Björkman said coking coal prices had risen by around 60 percent within a few months. He also pointed to strong raw material demand in the US during the first part of 2026 and growth in India. In Europe, in contrast, high energy costs have added to the challenges facing the industry, he stated.

Low Rhine water levels disrupt European scrap and steel movements

Björkman said the low water levels of the River Rhine, comparable to those seen in 2018, have disrupted movements of scrap and steel in Europe. Some material has remained in inventories instead of reaching its destinations, causing business to be postponed. He described European steel capacity utilization of around 65 percent as unsustainable.

Regarding coking coal, Björkman said the summer price surge was driven particularly by conditions in China and had also lifted Australian prices. Chinese demand has since eased somewhat, he said. Although he cited an increase of around six percent in Indian production this year, he does not expect it to offset weaker Chinese demand. Björkman therefore sees a slightly negative outlook for coking coal prices in the coming months and said the earlier surge may prove temporary in the short term.

Trade disruptions affect scrap purchases in India and Pakistan

Turning to import scrap markets in India and Pakistan, Björkman said disruptions to trade flows have had a substantial effect on purchasing. Buyers who previously could purchase smaller quantities with shorter lead times have had to consider larger volumes and longer delivery periods. Higher freight and financing costs make those changes more difficult, he explained. He added that demand for European material has increased.

The chairman of the raw material suppliers committee expressed concern about proposed changes affecting EU shipments of ferrous and non-ferrous material to non-OECD countries. North Africa and South Asia are significant and consistent buyers of European material, he said. In his view, restrictions could affect both their ability to purchase scrap from the EU and recycling activity within Europe.

Financing raw material trade has also become more difficult throughout the supply chain, according to Björkman. Higher interest rates, freight costs and raw material prices are encouraging companies to keep lead times short, buy according to immediate requirements and avoid accumulating large inventories.

Scrap to remain principal raw material for EAF-based producers

On the future raw material mix for electric arc furnace-based producers, Björkman said scrap will remain the principal input. HBI and DRI can supplement scrap, but he does not expect them to replace it. Their cost is a constraint in many regions, while energy availability influences where they can be produced. Björkman also questioned whether Europe could depend on supplies from the GCC given regional and political uncertainties.

Trade barriers seen as key risk for scrap market in 2027

Björkman said Europe has sufficient scrap for its own steelmakers and has opposed adding further restrictions and administrative requirements to its export trade.

Asked about the risks facing the market in 2027, he identified increasing trade barriers as a particular concern for scrap suppliers. Björkman expects trade to become more regional, with European exporters facing additional requirements.

The supply and demand balance in the global long steel products market has become marginally worse for international business since June, although supply has started to react. Global crude steel production moved from an increase of 1.7 percent year on year in June to a decrease of 0.3 percent in July, with China’s crude steel output moving from an increase of 0.4 percent to a decrease of 3.6 percent in these respective months. However, global production in the January-July period was down only 0.6 percent year on year, which does not yet signal a meaningful rebalancing. The market situation in the coming period is extremely difficult to predict, particularly given the geopolitical developments affecting the Black Sea region and the Strait of Hormuz. International trade has become increasingly challenging. Demand remains generally subdued, while disruptions to supply and logistics are creating upward pressure on prices.

Energy costs rise significantly, overall environment increasingly inflationary

At the same time, energy costs have risen significantly. Natural gas prices in Europe and elsewhere remain at very high levels, with electricity prices following the same trend, while coal prices have also moved higher. Consequently, the overall environment has become increasingly inflationary. We, therefore, have an unusual combination of relatively weak demand and rising costs and supply-side pressures, which are creating considerable uncertainty and volatility in the international steel market.

China’s steel bar exports rise further, its real estate investments deteriorate

In the meantime, China’s real estate investments deteriorated from a decrease of 18.0 percent in the first half to a drop of 19.2 percent in the January-July period, with fixed-asset investments and infrastructure investments decreasing by bigger margins of 6.7 percent and 3.6 percent respectively in the January-July period, compared to respective declines of 5.7 percent and 2.4 percent in the first half. Steel exports from China in July remained above 10 million metric tons, with steel bar exports rising by 20.9 percent in July and by 12.3 percent in the January-July period. Together with the tighter EU and UK import quotas from July 1, this means a better balance inside protected markets but more displacement into the remaining open markets. The imbalance is being redistributed rather than resolved.

Higher costs begin to push EU prices upwards

Demand in the EU market remains weak, partly due to the summer season and the continued lack of activity in construction. A sudden increase in consumption is not currently foreseen, particularly as we move into the fourth quarter, which is traditionally a period of slowing activity. Nevertheless, sharply higher energy costs are now pushing mills’ prices upwards. Exceptionally low water levels on Europe’s major rivers have also increased transport costs for both mills and importers. Even in a weak demand environment, producers cannot continue absorbing these additional costs indefinitely. The current upward price movement is therefore mainly cost-driven rather than the result of any significant improvement in consumption.

US remains one of the clearer growth markets, but high interest rates still a major issue

The US is one of the clearer growth markets: domestic steel shipments increased by 5.3 percent in the first half of 2026, while steel demand is forecast to grow by 1.7 percent in the calendar year 2026, supported by infrastructure and technology-related investment. There is a gradual demand recovery in the US as well as strong infrastructure investment and continued AI investments. Meanwhile, imports are down 22 percent year-to-date. Supply in the US long steel market is moderately tight but has been moving toward a balance as of August. High interest rates are still a major issue for residential and commercial construction. However, rising domestic capacity and slowly recovering imports should gradually ease the supply pressure. Overall, the situation is better for US mills, but tougher for international suppliers. The US is going on its own path, at least until the results of the mid-term elections are announced. In the meantime, there are about 20 steel producers in the US announcing outages for September, October and November.

Global prices to remain driven by supply-side factors rather than by demand

From a pricing perspective, the main supportive factors are the prospect of reduced supply pressure from China, disruptions affecting trade in the Black Sea and the Strait of Hormuz, higher energy and production costs, and the increasingly restrictive trade measures being implemented in the US, the EU and the UK. Global production finally saw a slightly negative correction in July, indicating that mills are beginning to respond. In the EU, steel producers are announcing profits. Our expectation is that prices will remain under upward pressure during the next quarter driven primarily by the abovementioned factors rather than by a strong recovery in underlying demand.

Global steel demand foreseen to improve in 2027, but no broad recovery yet

On the demand side, the picture is less encouraging. Nevertheless, there is still meaningful demand in the Americas, while demand in most other regions appears broadly stable rather than deteriorating significantly. Looking at the global situation, India, Southeast Asia, Africa and select US construction segments offer the best opportunities for long steel products. According to market analysts, global steel demand is expected to improve further in 2027, supporting trade volumes and market confidence. These are positives for select markets and margins, but not yet evidence of a broad global demand recovery.

Ferrous scrap market still characterized by weakness

The ferrous scrap market is weak without much movement towards the upside as steel mills seek to avoid price hikes that would further constrict their margins.

Competition at reduced levels amid limited number of viable supply alternatives

Competition in the global long steel market is currently somewhat reduced, mainly because the number of competitive supply sources has become more limited. Trade restrictions, geopolitical disruptions, higher freight and energy costs, and difficulties in accessing certain markets have all reduced the number of viable supply alternatives.

Current market status very unstable, market highly sensitive to geopolitical developments

Under such circumstances, the current status of the market can be described as very unstable. The market will remain highly sensitive to geopolitical developments, particularly in the Black Sea and the Middle East.

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The overall business environment in the global long steel products market has deteriorated again. Everything is even more difficult and complexities are increasing further. Nevertheless, the apparent de-escalation of the conflict involving Iran could mark an important turning point. If geopolitical risks continue to ease, we may be approaching the bottom of the current market cycle.

International rebar market now weaker compared to one month ago

The international reinforcing bars market is now weaker than it was a month ago. Demand in the market continues to be subdued, while supply remains high, putting pressure on prices and margins. However, in addition to the positive development represented by the easing of tensions in the Middle East, some producers are heard to have begun lowering production in response to market conditions, which should help improve the supply-and-demand balance over time.

Demand hit by low confidence, more Iranian and Russian billet could depress rebar prices

It seems that the concerns and lack of confidence shown by market players, in particular by buyers, constitute the main obstacles preventing demand from improving. The price of scrap shows how confident mills are for future planning. We may see more Iranian and Russian billets in the market, which would exert further pressure on reinforcing bar prices.

Producers face higher costs of power during the hot summer season

As far as costs are concerned, with energy demand increasing amid the seasonally high temperatures, the higher price of power will also work against producers’ interests.

EU struggles to improve its GDP, domestic prices soften due to weak demand

The overall geopolitical situation is not good for investments and Europe is still struggling to improve its GDP, while energy costs and inflation are rising. In the meantime, we have entered into a new phase regarding EU imports, which will only be observed during the initial days of the new quarterly period and will then be silent for the rest of the quarter. Despite the announcement of the quota reduction by almost 50 percent well in advance, EU mills had been able to raise their prices for a while, but now their prices are falling back to where they were before, as demand is weak all over the EU.

Chinese steel exports continue to increase despite gradual decline in output

There is nothing positive in the Far East except for the gradual decrease in production in China, which, however, will not change anything in the short run. Chinese steel exports continue to increase.

US market very reliant on data centers

Capacity utilization in the US is stalling at 81 percent and domestic mills are announcing increases of US$10/nt. The driver in the US market has been data centers, which are not all 100 percent-financed or are without building permits.

Most encouraging development was the easing of tensions in Middle East

Having said all above, the most encouraging development was the easing of tensions in the Middle East. Greater regional stability could have supported a gradual recovery in economic activity and steel demand, particularly in the Gulf markets. At the same time, despite the ongoing conflict in Ukraine, there are signs of improving demand for steel products. This suggests that reconstruction needs and investment could provide support for the market once geopolitical conditions normalize. These developments had given reason for cautious optimism about the medium-term outlook. But the tension seems to be there again.

Global competition still extremely intense, few genuinely free markets remain

Competition in the global steel market remains extremely intense. Trade flows continue to be shaped by tariffs, quotas and other trade measures, resulting in fragmented regional markets. Within Europe, competition is strong due to weak demand and significant production capacities. Competition in third-country export markets is even more challenging, as suppliers from around the world compete for a shrinking number of open destinations. Today, there are relatively few genuinely free markets remaining for global steel producers.

Current market status unstable, with a very unclear outlook

Under these circumstances, the current status of the market can be described as unstable with a very unclear outlook.

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The overall business environment in the global long steel products market remains relatively stable. However, regional differences have become more pronounced than ever. Protectionist measures in the United States, combined with the implementation of CBAM in Europe and the upcoming reduction of EU import quotas, are reshaping trade patterns and market dynamics.

Ongoing conflicts continue to create uncertainty and raise costs

At the same time, the ongoing conflicts in Ukraine and the Middle East continue to create uncertainty, disrupt trade flows and influence supply-demand balances across multiple regions. Higher oil and natural gas prices have increased transportation and production costs, while steel availability from Gulf region suppliers has become extremely limited. Marine insurance costs for cargoes have also risen due to increased geopolitical risks. Expectations that these disruptions will be short-lived have largely disappeared. As a result, many distributors and stockists are holding onto inventories amid concerns about future supply availability and stock replacement costs. Consequently, the market remains highly fragmented, with conditions varying considerably depending on geography.

EU market sees last-minute import buying ahead of new quota system on July 1

In the European Union and in the United Kingdom, the market is now starting to search for a new equilibrium because of the changes in the import regime from July 1. During the past few weeks, some last-minute import buying has been taking place, as buyers and traders try to position themselves before the new quota system enters into effect. After this, market players will have to adjust their strategy to the supply which is actually available in the market. There will still be imports, of course, and there will still be competition, but buyers will have to build their strategies around actual market availability, not around the cheapest theoretical import offer.

Scrap prices remain strong despite weak demand

There is no demand to support the continuing strength of scrap prices, but it seems that prices will stay where they were before the Eid holiday or they may come down by a few dollars to motivate Turkish buyers to resume buying. Deep sea scrap prices for Turkey remain some way above US$400/mt CFR despite weak Turkish rebar sales, while the strong scrap prices provide support for finished product prices. Meanwhile, Turkish mills do not expect much long product demand from the EU because of the new quotas to be introduced shortly in the region. Regional differences will certainly create different results for different regions and producers, especially for those who source scrap from the US and the EU and need to export their products.

Turkey’s production costs may increase, political situation to impact investment

Turkish mills were enjoying cheap energy costs due to the rainfall during the winter season. This will most probably end when temperatures start rising and the country starts using cooling systems. With the political turmoil in the country, investments will slow down, which will also be another factor causing demand for long steel to slacken.

Demand for semis due to Iran’s absence contributes to higher long steel costs

Demand for semis due to Iran’s absence is another factor contributing to increased costs of long products. In this context, Chinese exports of slabs and billets increased to around 900,000 mt in the January-April period this year.

Long steel market in Germany remains very weak

The market in Germany is still very weak. After the shockwave of higher energy prices (the impact of the Iran war) and price increases for all steel products and for logistics, many projects were put on hold. Consequently, cut and bend prices did not move up but are on the way back down. Benders are desperately looking for orders at somehow manageable prices. German and Polish mills have had to adjust prices down as well, otherwise benders do not buy. So, there has been a drop of around €30/mt in prices despite the seasonal improvement which reflects the level of investment in Germany right now. Better prices for benders from imports are practically not available anymore. Reduced quotas, CBAM and high ocean freight rates make business very difficult. New building permits went down by 10-15 percent and industrial projects by 20-30 percent. There is not even any input from the public sector.

Mixed bag of positive and negative factors in US market

In the United States, inflation remains a concern, and expectations for interest rate cuts have largely been pushed back, with higher rates now expected to continue into 2027. This has negatively impacted housing and construction activity, keeping demand relatively subdued. Meanwhile, steel imports remain restricted by the 50 percent Section 232 tariffs, higher freight costs and logistical uncertainties. Reduced import competition continues to support a gradual increase in domestic steel prices despite overall moderate demand. On the other hand, domestic steel prices are moving closer to import parity, which may improve future import opportunities. In addition, inventories remain relatively low, and continued investments in AI infrastructure, energy and industrial projects are providing some support for steel demand. The primary area of growth remains AI infrastructure and data center investments, although this business is largely supplied directly by domestic mills and these big projects are for consumption of reinforcing steel 12-18 months from now. However, these positives are still overshadowed by geopolitical uncertainty, high interest rates and weak construction activity.

Some positive developments in terms of investments

One of the key positives in the marketplace is the substantial level of investment being directed toward infrastructure projects, energy-related developments and data centers, all of which generate significant demand for reinforcing steel products. In addition, many governments in developed economies are increasingly focused on addressing housing affordability challenges. Policies aimed at expanding residential construction could support additional demand for long steel products in the medium term. Another positive factor for certain markets is the implementation of measures designed to protect domestic industries from unfairly priced imports. While these measures support local producers, they also reduce market access opportunities for exporting countries, highlighting the differing impacts across regions. There are areas like the Balkan and Baltic regions where demand is really great and investment in infrastructure is huge.

China’s crude steel output decreases, its iron ore imports increase

China’s crude steel production decreased by 4.1 percent in January-April, but its iron ore imports increased by eight percent to 418 million mt in the same period, and port stocks are close to 160 million mt. This is a very strange situation: steel production is characterized by weakness, but iron ore imports remain strong.

Divergence between open and protected markets

Competition remains extremely intense in international markets that are open to imports. Excess production capacity in several regions continues to put pressure on prices and margins. In contrast, markets that benefit from trade protection measures or restricted import access generally experience more balanced competitive conditions.

Current market status stable and challenging, outlook varies according to region

Under these circumstances, the current status of the market can be described as stable and challenging. While demand remains generally subdued in many regions, market participants have largely adapted to current conditions and no major short-term disruptions are anticipated. The outlook, on the other hand, varies significantly by region. In Europe and the United States, market sentiment is relatively decent, supported by infrastructure spending and protective trade measures. In many other parts of the world, however, the outlook remains difficult to predict.

Supply side will need to be monitored if Middle East crisis is resolved

Even if geopolitical tensions in the Middle East ease, the resulting increase in availability of supply could place additional pressure on already oversupplied open-trade markets. Furthermore, the current interest rate environment continues to weigh on construction activity and investment decisions in several regions.

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There were 99 representatives from 41 different producers among the 386 registered delegates from a total of 49 different countries. There were also 86 registrations representing 41 different raw material suppliers.

At the opening of the conference, Ioannis Manessis, chairman of IREPAS, said that two major conflicts – one in Ukraine and the other in Iran — have consequences for global trade in general and serious repercussions for the industry in particular. He said steel trade has been affected by both demand destruction and supply disruptions, as well as by elevated energy costs, higher freight rates and the practical difficulty of securing vessels on time to transport materials.

Mr Manessis added that protectionism continues to intensify at the same time. IREPAS chairman also said that real demand in the global long products sector remains subdued while geopolitical tensions have driven up freight, energy, and raw material costs. Combined with some degree of inventory replenishment, this has supported higher prices he concluded.

On the last day of the conference, producers of long steel products, as well as traders and raw material suppliers, shared the conclusions reached at their special committee meetings regarding the current situation in the markets with the general participants at the event.

Raw Material Suppliers at IREPAS: Tighter supply, geopolitics reshape global scrap market

Speaking at the panel session, Jens Björkman from Stena Metal International and also chairman of the raw material suppliers committee, shared the committee’s assessments of the current dynamics and difficulties in the global raw material markets. Mr. Björkman highlighted significant shifts in global market dynamics over the past year, pointing to tighter supply conditions, changing trade flows and increasing geopolitical influence on pricing and demand. One of the key developments has been the slowdown in Chinese steel output, with March production falling to the lowest monthly level in six years. This decline, linked to weaker margins and stricter controls, has supported sentiment in other regions, while iron ore prices have remained relatively firm at $105-110/mt due to supply-side constraints. India continues to stand out as a major growth market, supported by strong domestic sponge iron production. This has reduced its reliance on scrap imports, although the country could be an attractive destination, based on freight costs and pricing conditions.

The chairman of the raw material suppliers committee stated that, in Europe, safeguard measures and regulatory frameworks have reinforced protectionist dynamics, supporting intra-regional scrap demand. However, concerns persist over high energy costs and the risk of stagflation, which could weigh on longer-term demand. In the United States, stronger domestic steel production has boosted internal demand for raw materials. At the same time, the attractiveness of scrap exports has declined, particularly for high-quality grades, as supply increasingly shifts toward domestic consumption.

Mr. Björkman pointed out that Turkey has seen improved sentiment, supported by stronger steel production and demand. Reduced semis supply from Iran has increased reliance on scrap imports, pushing prices to around $410/mt, an annual high. Rising freight costs, driven by higher bunker fuel prices and disruptions of oil shipments through the Strait of Hormuz, have further supported pricing.

Mr. Björkman emphasized that there is no global surplus of scrap supply, as scrap continues to be steadily consumed. Europe exports around 19-20 million mt annually, reflecting limited domestic demand growth, but future availability may tighten due to increasing EAF adoption and regulatory constraints. Traditional importers in the Middle East may face challenges as scrap availability tightens in Europe and the US. Meanwhile, he noted, growing scrap generation and processing capacity in Asia, particularly in China and India, could gradually reshape global trade flows.

Mr. Björkman said that increasing regulatory requirements, particularly EU waste shipment rules, are expected to drive investment in sorting and processing. At the same time, tighter credit conditions and reduced availability of trade finance are adding complexity to global scrap trade. He went on to say that, despite strong pricing and demand conditions, the market outlook remains uncertain. Energy prices, economic growth and geopolitical developments continue to pose risks, while elevated oil prices at around $110 per barrel are still considered manageable for now. However, in conclusion, he commented that any deterioration in demand or purchasing power could quickly shift the market into a more challenging phase.

Traders at IREPAS: Geopolitical tensions and higher costs disrupt steel trade flows

Speaking during the panel session, Wilhelm Alff, director at Duferco and chairman of the traders committee, shared the committee’s assessment of current market conditions, highlighting weakening demand, regulatory pressures and rising geopolitical risks. Mr. Alff reminded that crude steel production in China reached around 960 million mt in 2025, while data from the first quarter of 2026 indicate that output may decline further or at best remain stable, with no clear signs of growth. In China, the sharpest drop was observed in the rebar segment, in which production fell by 12 percent, reflecting the ongoing downturn in the construction sector. The only improvement in China was the growth of more than 10 percent in iron ore inventories, mainly due to strategic stock building, highlighting the disconnect between raw material positioning and weak end-user demand.

This weakness in demand is particularly evident in Europe, where the overall economic outlook remains poor. Public spending is increasingly being redirected toward defense and social support rather than infrastructure, especially in Germany, limiting the recovery potential for steel consumption. The committee also pointed out that existing production capacity in the EU continues to exceed demand, noting that even prolonged production stoppages by major producers have had little visible impact on the market. A key concern for traders remains the implementation of the EU’s Carbon Border Adjustment Mechanism (CBAM). The committee chairman emphasized that, in the current environment, traders are advised to use default emission values when calculating CBAM costs in order to avoid risks, although this approach increases cost exposure. Uncertainty surrounding calculation methods and verification procedures continues to complicate transactions, making it essential to involve producers and clearly define contract terms.

In addition, recent changes to the EU safeguard system have added further pressure. Quotas have been reduced by nearly 50 percent, while out-of-quota duties may rise to as high as 50 percent. Market participants criticized the lack of adjustment in country-specific quotas, even where suppliers have not delivered material for extended periods. As a result, portions of the quota system remain effectively unusable, further tightening supply and negatively affecting buyers and end-users in the region. Against this backdrop, traders also highlighted the growing impact of geopolitical tensions, particularly in the Middle East. According to Mr. Alff, escalating tensions have tightened raw material supply chains and pushed costs higher, significantly slowing trading activity. Mills are increasingly relying on short-term sourcing strategies and opportunistic cargoes, while additional costs for transporting billets overland from Omani ports are estimated at around $40/mt. Severe port congestion is further complicating trade flows, making execution increasingly difficult. Despite these disruptions, the committee believes that the current situation is still being treated as temporary rather than structural. However, logistical constraints, especially in key maritime routes, continue to limit cargo movements and add uncertainty to global trade.

Commenting on global trade flows, Mr. Alff noted that exporters are likely to face growing challenges in accessing traditional markets. Tightening EU quotas and rising protectionism are forcing suppliers to seek alternative destinations, though options are becoming increasingly limited as more countries introduce similar trade barriers. Africa is expected to remain a key growth market in the medium term, supported by rising imports from Asia, particularly China, although the expansion of local production capacity and potential protectionist measures could gradually slow this trend.

Regarding China, the committee expects semi-finished steel exports to remain at elevated levels but under tighter control, as the Chinese authorities are likely to manage trade flows more actively to avoid another sharp surge. While the ongoing crisis in the Gulf region could support demand for Chinese material, its impact will largely depend on logistical conditions and the ability to move cargoes efficiently.

Looking at other regions, market conditions in the US and Latin America were described as relatively stable, with the US benefiting from solid demand driven by public infrastructure projects.

Overall, the traders committee underlined that the global steel market is entering a period of heightened uncertainty, shaped by weak demand in key regions, regulatory changes and geopolitical risks. In such an environment, Alff concluded that it is extremely difficult to predict price trends, emphasizing that market participants will need to continuously monitor developments and adjust their strategies accordingly.

Producers at IREPAS: Global steel sector under pressure from costs and weak growth

Alex Gordienko, export director of Spain’s CELSA Group and representing the producers committee, stated, in sharing the producers committee’s findings, that the global steel industry is facing increasing pressure from rising costs, weak economic growth and regulatory complexity. He noted that uncertainty remains high, particularly due to ongoing geopolitical tensions. Mr. Gordienko indicated that raw material prices have risen significantly, while the ability to pass these costs on to customers remains limited. As a result, margins across the industry are under sustained pressure, with finished steel prices failing to fully reflect higher input costs.

Mr. Gordienko noted that economic growth remains subdued across many regions, limiting the potential for a meaningful recovery in steel demand. He warned that current conditions reflect a fragile balance, with demand holding but lacking strong momentum. He described energy markets as highly volatile, largely due to tensions in the Middle East, adding that there is no clear timeline for a resolution and that a prolonged conflict could significantly worsen market conditions.

Mr. Gordienko went on to state that trade policy remains a key theme, with the EU’s Carbon Border Adjustment Mechanism (CBAM) at the center of discussions.

CBAM is seen as a mechanism that will gradually level carbon costs globally, encouraging countries such as Turkey, China and India to develop their own carbon pricing systems.

He said that, while CBAM is not expected to trigger immediate price changes, producers anticipate a medium-term disruption. By 2027, mills with verified emissions data are expected to gain a competitive advantage, as buyers increasingly prioritize suppliers able to provide reliable carbon data. Currently, only a limited number of suppliers, particularly in Japan and South Korea, are fully prepared for these requirements.

Meanwhile, the other restrictive factor, he pointed out, is that a new quota system stricter than the EU’s framework is expected to be introduced in the UK.

Mr. Gordienko commented that logistical challenges are adding further pressure, particularly in the Middle East, where port congestion is disrupting cargo flows. Limited truck availability and rising freight costs, driven by higher bunker fuel prices and fuel shortages, are increasing delivery costs for producers. He also stated that production disruptions in Iran have significantly affected global semis supply. Publicly available information indicates that facilities representing around 10 million mt of capacity have been heavily damaged, with recovery timelines ranging from six to 12 months. Iran exported approximately 3 million mt of semis in 2025, with around 75 percent directed to Asia. The disruption has contributed to increased Chinese semi-finished exports, particularly in March, as China moved to fill the supply gap. In the meantime, diesel shortages in Europe and transportation constraints are further amplifying cost pressures, with freight rates rising faster than oil prices.

On the raw materials side, Gordienko stated that availability remains a structural constraint. European producers, heavily reliant on scrap for electric arc furnace-based production, face limited flexibility in switching to alternative inputs such as HBI due to high energy requirements. This suggests limited short-term changes in production routes.

Lastly, he shared his prediction regarding the market outlook. Despite relatively stable demand and pricing conditions, the overall outlook remains uncertain. In conclusion, he said that energy prices, geopolitical developments and cost pressures continue to pose significant risks, leaving the global steel industry in a fragile and unpredictable environment.

There have been no signs of improvement in the global long steel products market. On the contrary, the current business environment has, unfortunately, deteriorated rather than improved in terms of the supply and demand balance. The wars, particularly in Iran and Ukraine, have significantly exacerbated existing disruptions across global supply chains. What we have seen looks more like a supply-side shock than a demand recovery: higher energy, electricity and freight costs have pushed prices upward, and these increases have so far been widely accepted by customers as inevitable.

Many economies would enter recessionary territory if ceasefire in Iran war fails to hold

So much will depend on whether the ceasefire just announced in the Iran war will hold. If it does not hold and should energy prices remain elevated, there would a substantial risk that many economies will enter recessionary territory, with wide-ranging and potentially severe consequences. Transportation costs have already risen considerably, while uncertainty surrounding future demand has increased across all major markets. At the same time, there is a noticeable shift toward greater protectionism, further complicating international trade dynamics.

US scrap export volumes decline, UK shifts to containerized scrap exports to Turkey

US ferrous scrap export volumes are in decline due to more domestic consumption and difficult prices in Asian markets, while the UK is shifting to containerized exports to Turkey.

On the bright side, increased pre-ordering and restocking activity observed

Despite the prevailing challenges, there are some positive aspects in the global market. Heightened uncertainty is prompting contractors involved in confirmed construction projects to secure supply in advance, leading to increased pre-ordering in order to mitigate the risk of further cost escalations. Additionally, in an inflationary environment, apparent demand often exceeds actual demand, as businesses tend to build up inventories as a precautionary measure. This dynamic is likely to result in a degree of restocking activity, providing short-term support to market demand.

Three distinct regional dynamics seen in competition in global market

Three distinct regional market dynamics can be identified in terms of the level of competition in the global market, which remains high, though it varies across regions. Broadly speaking, in the United States, competition is largely domestic, with local producers competing primarily within the internal market. In the European Union, the landscape is more mixed, characterized by intense domestic competition alongside a limited presence of imports from third countries. In contrast, in the rest of the world, competition is significantly more intense, with global players actively competing across multiple markets.

Rising costs of energy exerting pressure across the industry

At the same time, rising energy costs – particularly impacting steel producers – along with increasing scrap prices driven by higher oil and transportation costs, have exerted additional pressure across the industry. These factors are contributing to heightened competition globally, as producers strive to maintain margins and market share in an increasingly challenging cost environment. The market has accepted cost-driven price increases up to a certain degree. The uncertainty is in the second-order consequences. As with any supply-side shock, the market may have to rebuild around new supply routes, new energy costs and changing raw material availability, and it is still too early to judge how the wider economy will react. It will be necessary to wait and see what impact the ceasefire in the Iran war – provided it holds – will have on easing the surges in costs and if it will bring about a badly-needed return to something approaching normality for business and trade.

Current market environment very unstable, dependent on US war-related policy decisions

The current market environment can be best described as highly unstable and deeply influenced by geopolitical developments. In particular, the global economy has been increasingly dependent on policy decisions made by the United States administration in relation to the war against Iran, though some hope is now offered by the implementation of the ceasefire. Recent developments have intensified market volatility, with rising energy prices, supply chain disruptions and inflationary pressures creating a highly uncertain outlook.  In this context, market conditions remain fragile and unpredictable, with future stability largely contingent on geopolitical outcomes and policy direction in the coming months.

Outlook for next quarter remains uncertain

The outlook for the next quarter remains uncertain, primarily due to the geopolitical tensions in the Middle East. Market direction will largely depend on how the situation evolves in the near term.

If the ceasefire holds…

Should the ceasefire hold, an improvement in demand can be expected, leading to a more positive outlook and gradual market stabilization. However, were the ceasefire to break down and war to be renewed, the risk of a significant economic slowdown will increase. In such a scenario, many economies could enter recessionary conditions, with potential project delays or cancellations and an overall challenging business environment. Other than the military-industrial complex, all other industrial sectors would be negatively affected.

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Due the war in the Middle East, levels of uncertainty have surged in the global long steel products market. Energy prices are flying high, supply chains have been disrupted, bunker oil and freight rates are up and stocks are down. It is too early to predict the overall impact of the war. While concerns regarding deliveries of cargoes originating from regions in the East have helped push prices up in the Western markets, demand is not improving, which comes as no surprise especially when we have no clue about how long this war will continue or to what extent it might spread. Another major question is what will happen to scrap prices.

Investments to be put on hold, no panic purchases despite EU mills’ price hikes

Investments will be put on hold given the high levels of uncertainty all around. EU mills have reacted with price increases but, as the market is still waking up after the winter season, this has not resulted in panic purchases.

Imports into EU risky amid lack of regulatory clarity

Brussels’ incompetence or unwillingness to announce final CBAM regulations and how safeguard measures will be continued after June 2026 makes imports into the EU extremely risky.

Turkish mills face slow local and export demand, adjust capacity usage accordingly

In Turkey, construction activity is slow and exports are down by 20 percent compared to the same period last year. Mills are adjusting their production based on the demand they receive.

US Supreme Court gives some breathing space to importers, but new tariffs likely

The Supreme Court decision in the US against Trump’s tariffs gives a partial breather to importers. However, it will probably not be long before new tariffs will be implemented under different names.

Current market status unstable, outlook unpredictable

It is very difficult to talk about competition under the current levels of protectionism, geopolitical issues and uncertainty in the market. Under the current overall market circumstances, the current status of the market can be described as unstable with an unpredictable and unstable outlook.

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The global long steel products market is oversupplied and overcrowded. The situation has worsened and is now structural. The competition in the global market is predatory.  Margins are dead. The only strategy is cashflow and turnover. Whoever can ship first, wins. Whoever negotiates for $5/mt more, loses the order. Every confirmed business is a major success. Moreover, without the US market, competition may become brutal.

Latest US blanket 50 percent Section 232 duty marks unprecedented shift

The latest US decision to impose a blanket 50 percent Section 232 duty on all steel imports marks an unprecedented shift – one that severely impacts importers while handing a windfall to domestic producers. Although there was previously a similar measure targeting imports from Turkey, this universal application is unparalleled. What makes this especially jarring is its immediate enforcement, affecting cargoes due to arrive soon, offering no transition period or due process. This abruptness feels inconsistent with the values and principles we have long associated with the US marketplace – predictability, fairness, and rule of law.

New US decision cuts its market off from rest of world, importers handed long vacation

If the 50 percent Section 232 duty holds, it may ironically render the US the most expensive steel market globally, shutting it off from the world at a time when collaboration and balance are most needed. It seems importers in the US have been handed a long, scorching summer of vacation, just as they brace to absorb the financial fallout of all US-bound cargoes. These are extraordinary times and must be navigated with clarity, unity, and resolve.

Demand still weak in Europe and Turkey, with imports putting pressure on prices

Demand is still soft in the European market and imports are putting a ceiling on any potential price increases. Unless there is an actual pickup in end-user consumption, prices will hover at current levels or drop, especially if more cheap Asian billet flows in. Demand in Turkey is still lacking also, but more important is that, with the current iron ore and coal prices, there will be more supply pressure from Far Eastern and Southeast Asian suppliers. Far Eastern and Southeast Asian origin steel billet prices are going down almost every day.

Scrap-based producers falling behind in terms of costs

Scrap-based producers are getting priced out. Billet from Asia is cheaper than melting scrap. There is almost no point in running a melt-shop when you can just roll. This shift reshuffles power, as cheap billet exporters win and EAF-based mills are now considered high-cost producers.

Chinese long steel exporters start to push out Southeast Asians

Southeast Asian mills, who had dominated the market, are now being quietly pushed out by China. Chinese long product exports surged by over 100 percent year on year in the first quarter of 2025. Reduced blast furnace costs, falling domestic demand, and export subsidies mean this wave of Chinese exports will not slow as it is policy-driven, not market-driven. A serious displacement is taking place. Vietnam, Malaysia and Indonesia are all fighting for markets. Even South Korean mills, who were deemed to be bulletproof previously, are now closing lines for the first time in decades. China is stable, but prices are not going up and their steel is cheap, hoping for new export markets. Oil prices are also weak which is good for some players in the steel market, terrible for others.

Market currently very unstable, outlook unsatisfactory, seems to depend on political decisions

The market is currently very unstable. No one is making money. Everyone is quoting, but very few are actually booking orders. The outlook is unsatisfactory and seems to depend on political decisions.

OECD: Some brighter prospects in ASEAN and MENA regions

The recently published OECD Steel Outlook 2025 states, “Demand in the OECD area will remain roughly constant, while Chinese demand will decline appreciably due to the downturn in construction and structural shifts in China’s economy. Prospects are brighter in the Association of Southeast Asian Nations (ASEAN) and Middle East and North Africa (MENA) areas, where demand will grow strongly.”

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At the opening of the conference, Murat Cebecioglu, chairman of IREPAS, emphasized that demand in the global long steel products market continues to lag behind supply. He added that the situation was getting worse because of China’s aggressive export policy and that Chinese exporters would continue to be aggressive, which of course would drive other Asian exporters to be aggressive also.

The IREPAS chairman said the situation in the global long steel products market is deteriorating, adding that there is huge uncertainty on what the next couple of quarters will bring for the global long products market, where it seems the situation will be extremely difficult.

On the last day of the conference, producers of long steel products, as well as traders and raw material suppliers, shared the conclusions reached at their special committee meetings regarding the current situation in the markets with the general participants at the event.

Raw Material Suppliers at IREPAS: General market mood hopeful for improvement

Jens Björkman, the chairman of the raw material suppliers committee, summarized the committee meeting findings regarding the general situation in the global steel and raw material markets, noting that the markets have been struggling this year compared to the past few years amid the worsening of economies due to high inflation and interest rates. However, he stated that the general mood is hopeful for a return to something slightly more forward-looking and optimistic.

Regarding Western countries, he stated that high interest rates and inflation have been putting pressure on scrap generation in the US and the EU, and added that the interest rates in the EU are expected to be cut during the spring. With the anticipated increase in scrap demand due to electric arc furnace investments especially in the US, Canada and Europe, Mr. Björkman noted that scrap flows will change significantly in the next 10 years, regionalizing scrap generation where scrap demand is high. In addition, he stated that steel producers have started to look for alternatives to scrap like pig iron, HBI and DRI to cover their needs for raw material. Indicating that scrap generation in Europe is down by 15-50 percent depending on the part of the region, Björkman said that, with the Carbon Border Adjustment Mechanism (CBAM), European scrap suppliers will try to keep scrap volumes within the regional market, reducing scrap exports from the region especially to Turkey, which operates mostly with electric arc furnaces and has significant demand for scrap.

Looking at China, noting that the country’s economy was expected to rebound after the Chinese New Year holiday but that these expectations did not materialize, he stated that China’s economy is going through a period of normalization. Meanwhile, pointing out that before the recent rebound iron ore prices had fallen to $100/mt CFR in the first quarter this year from the higher-than-expected level last year of $120/mt CFR, he said that the factors contributing to the price drop included high iron ore inventories at Chinese ports, slow demand and lower steel production. He concluded by saying that the market in China is adjusting to the lack of recovery of demand after the Chinese New Year holiday, adding that he expects iron ore prices to remain at quite high levels.

Traders at IREPAS: Global demand to be supplied locally, market conditions lead to regionalization

F. D. Baysal, the chairman of the traders committee, stated that there is demand globally but that it will be supplied locally, adding that ongoing trade tensions, global conflicts and political instability have changed trade routes, resulting in regionalization.

Looking at the other factors that lead to regionalization, Mr. Baysal expressed the view that the EU’s safeguard measures will be extended for another two years and that its quota volume adjustment will be minimal if any. Regarding the EU’s Carbon Border Adjustment Mechanism, he stated that it will put pressure on other countries, especially on blast furnace-based producers.

Remarking that Turkey’s export markets have been limited due to the US safeguard measures, the EU quota restrictions and the geopolitical tensions in the Middle East, the chairman of the traders committee stated that there are still some export opportunities for the country, including Syria, Iraq, eastern Europe, Africa and possibly Yemen. In addition, noting that the shipping crisis in the Red Sea has affected freight rates and container shipments a lot more than bulk shipments, shipments had to be shifted from containers to bulk, leading to additional costs.

Looking at China, Baysal said that the low steel demand in the country amid cancelled infrastructure projects has resulted in an increase in the country’s exports, with China dominating the global market with its lower prices and higher quality of steel, leading the strong competition. He also cited the Chinese Metallurgical Industry Institute’s prediction for a 1.7 percent drop in China’s steel demand in 2024, after a 3.3 percent decline in 2023, while further noting that China’s steel export volume increased by 14 percent year on year in the first quarter, though the value of its steel exports during this period was down by 20 percent year on year.

Producers at IREPAS: Low demand and Chinese exports weigh heavily on global steel market

Murat Cebecioğlu, chairman of IREPAS and also chairman of the producers committee, shared with participants the conclusions reached by producers regarding the current situation in the markets. He said that the GCC region is more optimistic in terms of business given the big infrastructure projects in the pipeline there, while market conditions in Egypt are getting better and better as the country’s currency issue has mostly been resolved, though the Suez Canal crisis remains a challenge. In some EU markets, the economy is picking up and inflation seems to be under control, while in others demand still remains quite low.

Commenting on the situation in China, the hot topic at the conference, Mr. Cebecioğlu said that Chinese exports will definitely affect the global market negatively and will reach high levels as they did back in 2015. However, this time the number of export markets is limited because of protectionism and Chinese exports will be more problematic in terms of competition. He went on to say that, apart from China, Malaysia, Indonesia and Vietnam are also exporting heavily and competing with each other. This will affect other suppliers and, as one of the biggest long steel exporters, Turkey is already feeling the effects, the chairman of the producers committee noted. Chinese exports are also taking a toll on the EU market, which is also struggling with very low demand especially in the northern part of the region.

Other exporters to the EU have to deal with quota measures as well as the Chinese competition. Cebecioğlu said the EU will most probably extend its quotas for another two years and, with new suppliers such as the GCC and North Africa, things will be tough this year before picking up and getting better next year.

Responding to a question regarding how Turkish mills managed to increase production in the first quarter of the current year, the committee chairman said that, in terms of sales, the first quarter this year was much better than the corresponding period last year. Turkish mills were able to sell considerable amounts to the EU and, with the quotas opening up, they had a window for exports. Commenting on the reconstruction works in Turkey’s southern region which was devastated by earthquakes last year, Cebecioğlu stated, “Construction activity has already started in the region, and it is mainly the mills in the region that are benefitting from all this. Since export activity is very low, this gives these mills a little bit of a break, and also funding should not be a problem as these projects are being financed by the government.”

At the opening of the conference, Murat Cebecioglu, chairman of IREPAS, emphasized that the global long products market has recently been suffering from declining imports and exports and a lack of supply-demand balance.

The IREPAS chairman said the reduced production levels in 2022 have been carried over into 2023 and are able to satisfy actual consumption, which has resulted in an aversion to imported steel due to the lack of certainty, leading to a decline in the scope of international business.

On the last day of the conference, producers of long steel products, as well as traders and raw material suppliers, shared the conclusions reached at their special committee meetings regarding the current situation in the markets with the general participants at the event.

Raw Material Suppliers at IREPAS: Output cuts in EU to bring down scrap prices

Jens Björkman, the chairman of the raw material suppliers committee, summarized the committee meeting findings stating that the past few months have been challenging for the global steel market due to drastic price drops, higher energy prices and weak global demand.

Mr. Björkman pointed out that the energy crisis in the EU has eased, going back to pre-war levels and standing at a 10-year average, though high interest rates still remain a challenge. He said that there is a likelihood of production cuts ahead of the summer, which would bring down scrap prices and orders in the EU.

Regarding the potential consequences of the European Parliament’s recent revision of its Waste Shipment Regulation, Mr. Björkman stated that scrap shipments to non-OECD countries will be a major challenge, fortunately Turkey – which is a major destination for scrap supply – will not be affected. In addition, the committee chairman noted that within a five-year timeframe the EU will consume most of the scrap generated in the region itself since its steel production will shift to electric arc furnaces within the scope of green steel targets.

Aside from multiple challenges, Turkey is facing muted trade activities ahead of the approaching elections amid production cuts and weak demand for finished steel products, the committee chairman stated. He went on to say that once the election period is over Turkey is likely to see some pick-up in domestic business, though the demand in the local market will not be sufficient and so Turkey will have to try to export again. Regarding Turkey’s scrap demand, the committee chairman said that “a slower normal demand” is expected in the coming months.

Traders at IREPAS: Rough times for long steel industry         

Wilhelm Alff, chairman of the traders committee, said that the steel industry, especially the Turkish long steel industry, is going through very rough times amid weak domestic markets, high energy costs, a lot of trade cases, and new competition in the form of new players in the market such as Iran, India, China, the Middle East and Africa. Commenting on the Turkish market situation, the committee chairman said that areas which were previously reachable for Turkish long steel products are now getting less and less so, due to greater competition. He also drew attention to the fact that, as of March 31, Turkey had only used less than five percent of its EU rebar import quota, because of the reduction in EU steel demand and the increasing number of new mills in the region, for instance, the competitive offers from Oman and Egypt. He went on to say that, with the current market prices in the EU, which have been on a drastic downtrend since October last year and are at levels almost equal to import prices, buyers prefer domestic sourcing rather than waiting for late arrivals. The traders committee predicted that the EU quota situation will continue like this for at least another quarter.

Looking at China, Mr. Alff said that China’s tightening of its controls on overcapacity is likely to have a significant effect on market dynamics, resulting in decreased steel output which will support prices in turn. However, he added that this will also depend on how strictly these controls are implemented. The committee chairman stated that the anticipated demand in China failed to materialize after the New Year holidays and so it may be possible to see competitively-priced Chinese steel sold in the export markets. However, the extent to which this will happen depends on the level of demand in China and in the global market. He said that, if Chinese steel demand continues to be weaker than expected, Chinese suppliers may turn to the export markets, while China may face some obstacles due to trade measures.

Regarding the possible outcomes of the EU’s carbon border adjustment mechanism, Alff said that the approval of this mechanism is a significant move and it could face resistance from exporting countries such as China and India as they may consider these measures as unfair practice. He added that these countries may also respond with tariffs on European goods, which could lead to trade frictions. The committee chairman said that the eventual carbon border tax is likely to increase the cost of imported goods that have a heavy carbon footprint, which will result in difficulties for some countries as regards competing in the EU.

Producers at IREPAS: Falling energy costs and scrap prices may create opportunities   

Murat Cebecioğlu, chairman of IREPAS and also chairman of the producers committee, pointed out that the steel industry has been experiencing challenging times amid inflation and rising interest rates, which pose a big problem for investors in making decisions about their investments. He also said that supply and demand are not balanced and that exports and imports are declining everywhere, while adding that capacity utilization rates are way below usual levels. All these factors put pressure on the market, he noted. However, he also pointed to some positive factors, saying that energy costs and scrap prices are coming down.

Commenting on Turkey, the committee chairman said that the country has lost its major traditional export markets and its leading position, adding that the countries to which Turkey used to export, like Egypt, the GCC and Indonesia, have become exporters themselves. Another obstacle facing Turkish exports are trade cases. It is difficult to sell to the US, Canada and the EU and it is impossible to sell to Singapore and Hong Kong. He stated that, with falling energy costs and scrap prices, Turkey may have the chance to do business again. Regarding the steel demand expected in Turkey’s southern region following the devastating earthquakes in February, Mr. Cebecioğlu said that the unfortunate disaster will create demand, not only for the steel industry, but also for downstream segments as well. However, he pointed out that the demand will be spread over years, adding that it is not going to come all at once like people have been saying.

Turning to China, Cebecioğlu said that the Chinese market has not picked up after the New Year holidays, while he indicated that Chinese traders are very aggressive and very much active in the export markets. The IREPAS chairman underlined that China affects all market players because of its big capacity and that the Chinese are exporting to every corner of the world, so “if they stick to reducing production, this might help”.