Signs of potential demand rebound?

Global economies have continued in a growth pattern this year as measured by gross domestic product. The steel industry, meanwhile, continues to be buffeted by trade and geopolitical factors that have left recyclers uncertain about where their market stands.

Back-and-forth tariff activity in the U.S. and widely perceived steel overcapacity in China have been well-documented. Read more about the global steel market in “Actions and reactions.”

Steelmaking has been directly affected by these tariffs as have steel-consuming industries such as automotive and appliance making.

From May through August, prices for benchmark grades of recycled steel—prompt, shredded and heavy melting steel—have traded on the domestic market in a narrow $3-per-ton range, according to Davis Index and the Raw Material Data Aggregation Service of MSA Inc.

“Mills and dealers have enjoyed both steady business and market liquidity, and there’s nothing wrong with that scenario,” he says.

As the world paid greater attention to commerce after the summer, those who can benefit from rising recycled steel prices might see reasons for optimism in the second week of September.

On the domestic steelmaking front, the Washington-based American Iron and Steel Institute (AISI) reported positive mill output figures for the week ending Sept. 6.

During that week, steel output in the U.S. measured 1.795 million tons, up 7.7 percent compared with mill output in the same week in 2024, according to AISI.

Adding to the good news, the 1.795 million tons made in the first week of September represented a 1.5 percent increase compared with the previous week.

During the week ending Sept. 6, mills were operating at a capability utilization (capacity) rate of 79.2 percent, according to AISI, compared with a 75 percent capacity rate a year earlier.

Price tracking in India and political lobbying in Turkey could point to increased demand for recycled steel in those nations, too. Historically, Turkey is the leading destination for outbound U.S. ferrous scrap, while India in the past few years has emerged as the second leading destination.

In the second week of September, Davis Index reporting indicates buyers of containerized ferrous scrap shipped to more than one Indian port were willing to pay $3-per-metric-ton more for several different recycled steel grades compared with the previous week.

While those prices were offered in the United Kingdom and European Union, the increased bids signal a revival of demand in India, where construction activity and rebar demand slowed this summer.

Ferrous scrap demand conditions in Turkey have been reported as being influenced by the amount of steel billets and slabs imported from China and beyond.

Navigate Commodities reports that such shipments into Turkey reached a temporary peak in June before shrinking in July. However, in an August LinkedIn post, Navigate Managing Director Atilla Widnell says satellite monitoring showed a rebound in billets and slabs headed for Turkey.

Widnell says when rebar prices decline in China, Chinese steel traders almost instantly react by offering billets and slabs made in China, Indonesia and Malaysia to buyers elsewhere.

“Steel mills with rerolling lines will soon notice these attractively priced semis waiting in the corner of the dance floor,” Widnell says of Turkey.

Not all links in the Turkish steel supply chain are happy, however, based on an early September report.

The secretary general of the Turkish Steel Producers Association (TCUD), interviewed by Anadolu Ajansı (AA), expressed concern about rising steel exports from China, Russia, India and elsewhere in Asia.

TCUD Secretary General Veysel Yayan characterizes some of those imports as “cheap and substandard steel products” that are supported by state subsidies, creating unfair competition and reduced capacity utilization in Turkey.

Yayan says Turkey’s imports of steel from China have increased tenfold since 2020, while the U.S. and EU have introduced barriers to help address the situation in their market regions.