No holiday cheer in global longs market – rising costs add to already weak demand

As we approach the holiday season, the general atmosphere in the global long steel products market is still cloudy. To sum up the market situation, demand is weak everywhere, with the approach of the holiday season exacerbating this situation, while costs are rising, China is producing a little less but is still exporting. The net effect is that the supply-demand balance has not improved, it has just shifted for different reasons. Decreases in consumption globally have put demand in a weak situation, with customers not yet observing any rises in consumption on the horizon which would give them hope for brighter market prospects.

EU market more cost-driven than before, scrap supply tighter

What has changed in the market is the cost structure. Scrap supply in Europe is tighter than usual, possibly in expectation of CBAM in 2026. Combined with higher electricity prices, this has pushed prices higher even though finished steel demand has not changed. So, the market is now even more cost-driven than last month.

New EU safeguard measures give brief boost, but demand shrinking in general

We have seen some price increases and a relative rise in demand in the EU due to the announcement of new safeguard measures. However, this improvement is temporary. Demand in the EU is shrinking in general despite promised infrastructure projects and a lack of apartments. The capacities of EU producers have increased over the past 12 months again, which increases the imbalance in the market. Despite the upcoming CBAM and tougher safeguard rulings, prices in the EU have been increasing only by very small margins due to low demand. No change is in sight.

China still exports at full speed, production cuts make little difference

On the supply side, China is finally showing real production cuts. In the first 10 months of the year, China’s crude steel output amounted to 817.87 million metric tons, down 3.9 percent year on year. This is the first meaningful drop in a while and should, in theory, take some pressure off the global balance. But as long as the tonnages they actually produce continue to flow abroad, the practical impact of the reduction in output is limited. In reality, China is still exporting at full speed because their domestic consumption is dropping even further. On the other hand, the export market is more attractive for the Chinese. Any changes in the rest of the world will have little impact on Chinese exports, as hopes fade of a stimulus by Beijing to boost domestic steel consumption.

Projects put on hold in US due to high interest rates

In the US, demand is still flat. Due to year-end taxes, most stockists are trying to reduce their inventories. Buying decisions are being pushed to 2026. Infrastructure investments are slow and due to high interest rates residential and commercial construction projects are put on hold, waiting for further interest rate cuts. Imports are reduced due to high duty and competition from domestic production.

Many countries still hoping to negotiate tariff exemptions with US

Many countries are trying to find a way to negotiate with the US to gain exemptions from tariffs, especially Mexico. The EU will probably also offer a new deal to the US once its new safeguard is in place. Any exemption will of course change the dynamics of the market.

Turkey’s scrap imports decline, sensitive to increases in scrap costs

Sudden increases in scrap prices will also cause production cuts in Turkey. Turkey’s scrap imports declined by 7.3 percent to 15.23 million mt in the first 10 months of 2025. The import volumes in the corresponding periods since 2020 varied in the range of 18-20 million mt.

Great uncertainty predominates in very unstable market situation

There are factors creating tremendous uncertainty in the global longs market, such as CBAM and the awaited ruling of the US Supreme Court on the legality of Trump’s tariffs, which make future planning extremely difficult. Meanwhile, competition in the market is intense but for low volumes. Under these circumstances, the current situation in the market can be described as very unstable.

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