Stainless steel producers in Europe are increasingly concerned about demand for their products due to the expected recession on the continent.
The sentiment was voiced by Joost van Kleef, Europe, Chairman of BIR’s Stainless Steel and Special Alloys Committee. “This is a challenge facing most industries, to which we can add the influence of a record level of imports of finished products, particularly in the stainless steel sector,” he writes in the latest BIR Mirror. “As a result, selling prices for stainless steel have fallen rapidly – in fact, faster than ever.”
Van Joost notes that producers are experiencing one of the lowest capacity utilization rates in the industry and says the situation is unlikely to improve in the short term. As a result, demand and prices for stainless steel scrap remain very low.
The US perspective comes from Spectrum Alloys board member Doug Kramer. “American manufacturers have become increasingly concerned about managing their inventory in the face of rising interest rates, slowing demand and a stronger dollar,” he writes. “The traditional summer lull in steel production and business activity also played a role.”
According to the American Iron and Steel Institute, crude steel production in the United States from the beginning of the year to the end of September fell by 4% compared to the corresponding period last year. At the same time, the US steel industry’s capacity utilization rate fell to 76% at the end of September, from more than 83% in the same period last year.
Although the drop in container rates indicates a gradual improvement in availability, Kramer notes that the United States continues to suffer from shortages of trucks and truck drivers.
On the positive side, the easing of domestic market conditions was partially offset this year by increased export demand for recycled stainless steel. According to the U.S. Department of Commerce, more than 253,000 tons of stainless steel scrap were exported in the first six months of 2022, a 67% increase from the corresponding period in 2021.
According to Vegas Yang, Board Member of HSKU Raw Material in Taiwan, “Asian demand for stainless steel continued to slow in the third quarter of 2022 and the outlook for the final quarter does not look strong, so we can expect to a lackluster end of the year”. .’
The demand for stainless steel scrap is healthy in China and there have been some imports of stainless steel scrap into China from Europe, which has been rarely seen in recent years. India’s 15% export duty on finished stainless steel products has, meanwhile, dampened demand for scrap imports in that country.
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