The International Rebar Producers and Exporters Association (IREPAS) projects a stable first quarter in 2020, although the challenging conditions from this year will carry over.
In the US, destocking and reduced work-in-progress inventories have led to higher trade prices, which have withstood political uncertainty. Moreover, relatively mild winter conditions, low interest rates and liquidity in the global marketplace have buoyed the market.
The scrap market has dealt with turbulence all year and IREPAS noted there still doesn’t appear to be strong signs of global economic recovery around. European and US blast furnaces significantly cut production in 2019. However, a fairly active global long steel products market is a positive sign for the industry. Still steel producers’ profit margins have contracted because their customers have been reticent to raise inventories.
China has also become the most influential country driving iron ore, coke, HBI, basic pig iron, slab and billet prices. While it isn’t a global force behind markets for hot rolled steel sheets in coils, plates, rebars and wire rods outside of Asia, China is dominant within the continental market. The country’s robust steel consumption has dissuaded Chinese suppliers from increasing exports.
The ferrous scrap market is trying to keep up with low inventories in many regions that are in need of being replenished.