Steel association sees more scrap staying in Europe

The International Rebar Exporters and Producers Association (IREPAS) has issued a summary of a recent meeting stating in part that officers of the trade group seem to advocate Europe should restrict scrap exports and predict European ferrous scrap will soon all be needed in its furnaces.

IREPAS held its 88th meeting in early May in Barcelona in conjunction with the SteelOrbis Spring ’23 Conference, organized by that Turkey-based information services company.

At the IREPAS meeting, the association’s raw material suppliers committee chair Jens Björkman of Sweden-based Stena Metal International AB predicted 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 (EAFs) within the scope of green steel targets."

Regarding the potential consequences of the European Parliament’s recent revision of its Waste Shipment Regulation, Björkman said scrap shipments to non-OECD (Organization for Economic Cooperation and Development) countries will be a major challenge, adding that, fortunately, Turkey—a major destination for steel scrap exported from the EU—will not be affected.

Wilhelm Alff of steel trading firm Duferco Deutschland GmbH, who also chairs the IREPAS traders committee, said China’s tightening of its controls on overcapacity is likely to have a significant effect on market dynamics, resulting in decreased global steel output.

However, he added this will depend in part on how strictly these controls are implemented. Alff said that steel demand in China failed to materialize after the Lunar New Year holidays and it may be possible to see competitively-priced Chinese steel sold in the export markets.

Regarding the possible outcomes of the EU’s carbon border adjustment mechanism, Alff called the approval of the mechanism a significant move and said it could face resistance from exporting countries such as China and India, as they could consider these measures as unfair practice.

He said such countries may respond with tariffs on European goods, which could lead to trade frictions.

Trade tensions also were on the mind of Murat Cebecioğlu of Turkey-based ICDAS Steel, who is the overall chair of IREPAS and its producers’ committee. He said trade hurdles have made it difficult to sell steel to the United States, Canada and the EU, “and it is impossible to sell to Singapore and Hong Kong.”

Additionally, he said Turkish steelmakers had lost markets in countries to which they used to export, including Egypt, the Gulf Cooperation Council nations and Indonesia, because those regions have become exporters themselves.

Regarding steel demand expected in Turkey’s southern region following devastating earthquakes there in February, Cebecioğlu said the natural disasters will create demand for the steel industry, but said that demand will be spread over years, adding it is “not going to come all at once like people have been saying.”

The 553 registered delegates in Barcelona were from more than 157 producer representatives from 58 different companies. Attendees came from 55 different countries and included more than 80 raw material suppliers.

The full IREPAS 88th meeting summary can be found here.