There were 123 representatives from 49 different producers among the 406 registered delegates from a total of 56 different countries. There were also 79 registrations representing 41 different raw material suppliers.

At the opening of the conference, Murat Cebecioglu, chairman of IREPAS, said that demand is still very weak in the global longs market and the situation remains difficult as mills are cutting back on production and protectionist measures are continuing full speed ahead, while China and other countries in Asia are exporting a lot, putting pressure on prices.

The IREPAS chairman added that there is very severe competition in the market, and every producer is fighting with its last penny in order to keep operating.

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: Global trade conditions are “devastating” due to uncertainty

Jens Björkman, the chairman of the raw material suppliers committee, said that, in the recent period, global trade conditions have been extremely difficult, describing the situation as “devastating” amid the current uncertainty. Pointing out that trade barriers and uncertainties continue to weigh heavily on the market, particularly with the US tariffs forcing some countries to find alternative destinations, he added that this shift has created pressure on other markets, including Turkey. Regarding the protectionism in the market, he stated that there are rumors that the EU will impose some duties on Asian materials due to the huge inflows of cheaper steel from the region. Meanwhile, noting that China, which is the main exporter of cheap steel, has signaled plans to reduce steel production and exports in 2025 and 2026, albeit the actual outcome remains uncertain, he said that, in the longer term, larger investments in EAF-based production are expected, supported by stable electricity supply and growing domestic scrap availability. China has also announced a cut of about 90 million metric tons in its steel production in 2025.

Highlighting that the planned green transition in the steel industry is increasingly being questioned, with many investments being cancelled and projects being delayed, Mr. Björkman stated that the EU’s move toward electric furnace-based production has now been postponed by at least three to four years. He underlined that, if carbon emission trading in Europe and the related pricing system are fully implemented, emission reduction technologies will need to be installed more widely. However, he said that, instead of hydrogen-based DRI, natural gas could be used in the short term. In addition, the raw materials committee chairman said EU waste shipment regulations treating scrap as waste will create more bureaucracy, especially for non-OECD countries needing formal approvals to buy European scrap, while OECD trade remains unaffected. Regarding the concerns over domestic scrap oversupply, he stated that Europe already faces excess supply overall, but certain grades like clean automotive scrap could face shortages. This imbalance, he explained, is why EU steel producers push to keep scrap within Europe.

Looking at Turkey, Björkman noted that the recent increase in freight costs has become a burden for suppliers, leading prices to increase slightly in Turkey, though how long this situation will last remains difficult to predict. Regarding the changes in Turkey’s inward processing regime, the committee chairman stated that Turkish mills, who are already struggling amid high costs, may become less competitive in the short term as scrap prices may increase slightly, leading the mills to reduce production.

Meanwhile, stating that raw material demand in the GCC market is expected to focus more on DRI/HBI, which remains limited in supply, he emphasized that larger volumes will be needed in Europe to support flat steel production and the green transition, though a mix of DRI/HBI and scrap is likely to be used.

Traders at IREPAS: Protectionist measures will continue for foreseeable future

F.D. Baysal, the chairman of the traders committee, said that China’s exports have increased at a much higher pace than its production. He stated that there are no expectations for production cuts in China and that its domestic stock levels remain at normal levels. In response to questions on how China is reacting to trade barriers, he explained that Chinese producers have begun investing in production facilities in other regions, including Africa and South America.

Looking at Turkey, Mr. Baysal said that the high cost of energy remains a key challenge for Turkish mills. He noted that, in order to save energy and comply with CBAM regulations, Turkish producers have started investing in solar and renewable energy sources, which are expected to reduce production costs. Meanwhile, saying that there are no clear plans in the EU to ease green transition requirements, though delays remain a possibility, he commented that CBAM will eventually be enforced, but significant work is still needed to establish reference levels for both European and overseas mills. He added that, despite uncertainties, European producers are already moving from blast furnaces to EAFs and investing in renewable energy sources such as solar to balance costs and meet future carbon requirements.

Commenting on protectionist measures, the committee chairman stated that the Trump administration’s tariffs, reaching 75-100 percent in some cases, have nearly halted steel imports into the US, while Canada and Mexico have also imposed strong protective measures, leaving the North American market heavily restricted. Stating that he believes that protectionist measures will continue for the foreseeable future, Baysal said that further barriers against cheaper Asian steel are likely, but stressed that free trade remains the best option, though current trends are moving in the opposite direction.

Regarding prices, he highlighted that the current spread between rebar and scrap prices stands at around $200 or slightly less. He suggested that this points to a likely regression in scrap prices. He also compared production methods, stating that blast furnaces currently hold a cost advantage of about $25/mt over electric arc furnaces as the latter depend on electricity prices, though these are lower in countries like the US. On freight, Baysal noted that container freight rates have come down from post-Covid highs of around $4,000 to about $1,200, adding that he does not expect them to fall further.

Producers at IREPAS: Chinese exports and protectionism squeeze global steel industry

Murat Cebecioglu, chairman of IREPAS and also chairman of the producers committee, said that, as demand is very limited, everybody is trying to protect what is theirs. “We can sell to the EU only once every three months because of the quota and it fills up as soon as the quota is opened. Because of China we cannot sell to many places. Chinese exports are hurting everyone,” he explained. The committee chairman pointed out that China is the main driver, exporting heavily at low prices, exerting pressure everywhere amid generally limited demand. Many countries are imposing protective measures not only on China but also on some other Asian countries, considering that the Chinese are quick to move their production elsewhere to avoid trade barriers.

Regarding Turkish mills’ capacity utilization rates, Mr. Cebecioglu pointed out that, under current market conditions, utilization rates are not at decent levels and, with protectionist measures still in place, Turkey has limited space to export, with only a few countries left, and competition is very tough in those countries. He also added that the countries to which Turkey used to export have become exporters themselves and this affects Turkish production in return. Turkey’s steel production capacity stands at around 60 million mt, but the country is currently producing just 38 million mt. In addition to trade measures, China is exporting heavily all around the world and, as it is difficult to give low prices to compete with the Chinese, in the end Turkish mills have to cut production, he remarked.

Commenting on China’s work plan for the steel industry in 2025-26, the IREPAS chairman underlined that the Chinese are always coming up with some kind of plan, but it is yet to be seen how much of it will be implemented and how they will proceed. This work plan, he noted, consists of many things; regulations, environmental constraints, shutting of inefficient mills, and technological upgrading for green steel and low carbon production. In the end, future competition will depend on being cleaner, he stressed. He also commented that, if this Chinese work plan goes through, it will mean that there will be export regulations, leaving room for Turkish mills to breath.

Talking about the mega projects in the GCC region, Cebecioglu said that demand is quite good in the region and GCC-based mills are also exporting to the EU and North African countries, where they are very competitive against the Turkish mills. As GCC mills have lower costs compared to Turkish mills, they have the upper hand in prices in terms of costs.

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The 67th meeting of IREPAS (International Rebar Exporters and Producers Association) was held in Munich between September 30^th and October 2^nd, 2012. There were 80 producer representatives from amongst the 276 registered delegates from 37 different countries.

Ioannis Meimaroglu, the chairman of the IREPAS Raw Material Suppliers Committee, said that steel mills have been trying to secure their orders before finalizing their raw material purchases due to instability and difficulties in the finished steel market, which means that they have been obliged to change their strategy from working on stock basis to working mainly on spot basis. He went on to state that this is affecting steel scrap suppliers very negatively since they cannot collect material on a continuous basis, as they do not know at what price level the material will be sold when their customers come to the market.

Mr.Meimaroglou added that this situation is also posing problems for steel producers, as they can never be sure of steel scrap availability at the requested prices on spot basis.

Underlining that scrap suppliers need time to collect scrap and cannot meet demand from steel mills at short notice, Mr.Meimaroglu said that scrap suppliers understand the concerns of the steel mills and the uncertainty in the steel markets, as steel export destinations become more limited and as Chinese steel exports target steel mills’ traditional customers.

He added; it is also very important for steel producers to help keep their raw material suppliers alive, as the latter are facing pressure from finished steel
markets and also price competition in their domestic markets, as well as fluctuations in currency exchange rates and export regulations.

Michael Setterdahl, the chairman of the IREPAS Traders’ Committee, listed the economical crisis and Chinese exports as major concerns in the market, stating that macro decisions made by some governments, especially China,  have recently been impacting the steel prices more than the producers’ own pricing policies. Mr.Setterdahl added that as long steel production is low globally except for China and Turkey , the outlook for prices of long products in 2013 is positive and recapped the discussions by saying “Everything depends on demand and supply, as always.”

Uğur Dalbeler, chairman of both IREPAS and the Billet Suppliers’ Committee, stated that the recent news on Chinese supply has put some pressure on steel billet prices in the international market. However, he went on to say that the view of the billet suppliers’ committee is that downward price movement may not be seen, as downward pressure on prices is expected to be softened by the oncoming winter season. The IREPAS chairman stressed that the real issue for the producers is to achieve healthy margins in business. The committee agreed there are shortages of scrap and that this is the main reason why billet prices have not decreased further. He characterized the general situation in the global billet markets as being in equilibrium. In conclusion, Dalbeler emphasized that, the
difficulties in scrap collection during winter months will provide support not only for scrap but also for billet prices.

Mohammed Al Saadi, the chairman of the IREPAS Rebar and Wire Rod Suppliers Committee, mentioned that the local Turkish market seems strong, with demand at good levels in the market. While the situation in Qatar and other Arab countries seems healthy with high production capacity utilization rates, demand in these countries is also good on the back of ongoing investments and projects. In the meantime, whereas political issues in Syria and Iran have been affecting the business in a negative way, everybody hopes the situation will be resolved in the short term, Mr. Al Saadi said.

Mr. Al Saadi explained that almost 65 percent of the production in Europe, especially Italy and Spain, is exported, adding that the US and Carribean markets seem stable, while global market conditions in general are likely to continue in their current state until next year. The committee considers the main market
concern to be Chinese supply, which also has a psychological impact on business.

Notes to Editors:

IREPAS is a global association of producers and exporters of long steel products. It was founded by CELSA and GERDAU 29 years ago to develop understanding between producers, traders and consumers around the world. Today, IREPAS unites producers, traders, consumers of steel and professionals from the shipping and finance industries.

September 30th, Sunday

18:00 – 19:00

IREPAS Board Meeting

19:00 – 23:00

Welcome Cocktail at Hilton Munich Park Hotel

October 1st, Monday

09:30 – 12:30

IREPAS Committee Meetings

09:30–11:15 Wire Rod & Rebar Suppliers Committee (by invitation only)

09:30–11:15 Billet Suppliers Committee (by invitation only)

11:30–12:30 Producers Committee (by invitation only)

10:00–12:30 Raw Material Suppliers Committee (by invitation only)

10:30–12:30 Traders Committee (open to all attendants)

12:30 – 14:00

Lunch Break

14:00 – 15:30

Welcome Address by the Chairman of IREPAS – Mr. Ugur Dalbeler

SESSION ONE – Global Market and Macroeconomics

Keynote Speaker: Lutz Karpowitz, Commerzbank AG

• Global Market and Macroeconomics
Alexander Gordienko, Celsa Group

• The German Scrap Market – Today and in Future
Dirk Sauter, Schrott Wetzel GmbH

• The Freight Market Outlook
Enrico Paglia, Banchero Costa
15:30 – 16:00

Networking Break

16:00 – 17:00

SESSION TWO – Steel: Opportunity in Crisis
Peter Marcus, World Steel Dynamics

18:00 – 18:30

Leaving Hotel for Gala Dinner

19:00 – 23:00

Gala Dinner – Hofbraeuhaus

October 2nd, Tuesday

10:00 – 11:30

SESSION THREE – Panel with Committee Chairmen

Committees:
- Wire Rod & Rebar Suppliers Committee
- Billet Suppliers Committee
- Producers Committee
- Raw Material Suppliers Committee
- Traders Committee

Other details will be announced soon.