Prices in the long steel market are trending up on strong demand and tight supply globally, according to the Irepas monthly short-range outlook.
China continues to roar ahead, now surpassing 3mn mt of liquid steel production per day. Despite the surge in Chinese steel output in the first two quarters, the country has continued to import semi-finished material, which has pushed up prices in the global market.
At the end of April, China announced the cancellation of tax rebates on exports and as a result, it most probably will not export steel in the near future. This will open new opportunities for other market players like Turkey to increase their exports. Such recent decisions in China should result in pressure pushing prices up further, the outlook noted.
The North American market is also short on steel. In the US, demand has increased exponentially, but its proving far more challenging to ensure supply. The order books of all domestic mills are full, with order deliveries extending to four to eight weeks. Imports are harder to ship, as international mills are busier. Besides, shipping is a big challenge, with more delays at double or triple the costs. Prices are at historic highs, according to Irepas.
Latin America is no exception in the global market, where supply is tightening and demand is increasing. Domestic sales continue to improve in the region, with higher volumes compared to the pre-pandemic period.
Demand in the EU remains strong, but the market is short of steel. Construction companies have tried to push cut and benders down on price by holding back orders but are now with their backs to the wall and have to place orders at much higher prices compared to their budgets, as Irepas reported.