Heinz-Jürgen Büchner: Growth in construction industry to drive steel demand
During his presentation at the SteelOrbis 2025 Fall 2025 Conference & 93rd IREPAS Meeting held in Munich on September 28-30, Dr. Heinz-Jürgen Büchner, independent commodity consultant, highlighted trade tensions, sectoral growth prospects and the energy transition as defining factors for the global steel industry’s future.
Noting that growth in the construction industry and in population promise long-term growth for steel demand, Dr. Büchner said that high tariffs and energy costs, as well as geopolitical tensions, remain challenges for the steel industry.
Global economic outlook: IMF raises growth forecasts for 2025
In its forecast updated at the end of July 2025, the International Monetary Fund (IMF) said it expects slightly higher growth in the global economy (+0.2 percent) for 2025 than in its April 2025 outlook, predicting three percent growth for this year and 3.1 percent for 2026. The main reason for the slightly improved outlook is primarily the slight reduction in US trade tariffs on its most important supplier countries. Dr. Büchner noted that Asia-Pacific continues to offer strong growth potential, particularly in Indonesia, the Philippines, and Malaysia, while Africa and the Middle East face uneven prospects due to geopolitical conflicts. South Africa, Canada, Brazil and especially Mexico are suffering particularly from the high US tariffs, while Turkey is affected especially by high inflation and weak consumer demand.
Automotive industry under pressure from US tariffs
Dr. Büchner noted that light vehicle production is expected to fall slightly to 89.2 million units in 2025. The US’ constant attacks on the global trade order through ever-new tariff threats are making planning increasingly difficult for all exporters, while there are significant differences in customs duties on imports of passenger cars, which are often influenced by the goodwill or political views of the US president.
Construction industry growth to drive long-term steel demand
According to the consulting firm NMSC, the global construction market volume is forecast to grow from $11.4 trillion in 2024 to $16.1 trillion by 2030. Population growth and infrastructure investment, particularly in renewable energy, will drive this expansion. The world’s population is set to reach 8.57 billion by 2030 and nearly 9.7 billion by 2050, driving long-term steel demand through urbanization and infrastructure needs. Noting that the European and German construction industries are currently struggling as a result of sharp increases in construction costs and the effects of the Russia-Ukraine war, Büchner said however, that construction volume growth in Europe will also take a turn for the better in 2025, before picking up speed again significantly in the following years.
Other industrial drivers
Regarding other industrial drivers of the steel industry, he forecast that the mechanical engineering, aircraft and defense industries will drive additional steel demand. Global mechanical engineering sales could reach €4.1 trillion by 2030, supported by digitalization and artificial intelligence. Meanwhile, Boeing forecasts the global civil aircraft fleet will double by 2042, further underpinning demand for steel.
Acciaierie d’Italia: 10 bids for acquisition of former Ilva facilities
The extraordinary commissioners of Taranto-based Italian steel producer Acciaierie d’Italia (formerly Ilva) have announced that as of September 26 10 bids have been received for the acquisition of the former Ilva facilities.
As previously reported by SteelOrbis, the deadline for submitting binding bids had been postponed from September 15 to September 26 to “allow bidders to complete the necessary documentation” and ensure transparency and equal treatment.
Among the bids received, two are for the entire complex (Bedrock Industries, and a consortium of Flacks Group and Steel Business Europe) and eight are for individual assets (Renexia (Toto Group), Industrie Metalli Cardinale (IMC), Marcegaglia, a consortium of Marcegaglia and Sideralba, CAR Srl, a consortium of Marcegaglia, Profilmec and Eusider, Eusider, and Trans Isole). In addition to these, a further bid was received “from a political entity that does not meet the criteria of the tender”. Any proposals submitted after September 26 will only be evaluated if they are particularly advantageous.
Acciaierie d’Italia reports that the special commissioners will take the necessary time to review all bids received, “with particular regard to employment aspects, decarbonization, and the size of investments, in order to ensure the sustainable development of the plants and maximum protection for the workers involved”.
IREPAS Meeting: 2025 set to be record year for China’s steel exports
During his presentation at the SteelOrbis 2025 Fall Conference & 93rd IREPAS Meeting held in Munich on September 28-30, Alexander Gordienko, export director of Spain’s CELSA Group, started off by underlining that in July this year the IMF forecasts a 3.0 percent global GDP growth compared to 3.3 percent growth in 2024, indicating a loss of potential steel demand amounting to 25 million mt.
He added that emerging Asian countries are expected to see a growth of more than five percent, pointing out that 88 percent of the growth is coming from outside of China, showing that a lot of developing countries are doing well economically.
Looking at construction, Mr. Gordienko said that in the EU the construction sector is recovering this year, but only in infrastructure, with housing starts blocked by bureaucracy, while in the US as well, housing starts are down, by 19 percent since 2019, while infrastructure spending increased by 14 percent over the same period. In China, no hope of a recovery is on the horizon, with steel demand from housing decreasing by 45 percent compared to 2019.
Based on worldsteel’s August 2025 figures, the CELSA official pointed out that India is emerging as the country which has increased its steel production the most, with an increase of more than 10 percent year on year in the January-August period. India is producing as much as Japan and Russia combined, he noted. On the other hand, in the same period MENA and Southeast Asian countries also posted increases in steel production.
Gordienko also talked about Chinese steel exports as “the elephant in the room”, stating that as of July 2025 Chinese steel exports increased by 10 percent year on year, while China’s rebar and wire rod exports rose by 50 percent and its semi-finished steel exports surged by 310 percent, both year on year. He underlined that 2025 will be a record year for China’s steel exports, certainly exceeding 2015-16 levels.
Stagnant demand and mounting trade tensions
Comparing 2020 and 2025, long steel consumption decreased by nine percent and “as more and more capacity comes online, mills will have to cut costs so volumes will not be going up soon.” Gordienko said. Looking at capacity utilization rates, he indicated that, with 165 million mt of EAF capacity expected to come online, the capacity utilization rate will drop to 73.1 percent in 2027. He also explained that every percentage point decline means 18 million mt of capacity being idled, which is equal to Spain’s annual production. Compared to 2019, rebar consumption in 2025 increased by one percent, while wire rod consumption decreased by three percent and steel section consumption rose by four percent. Regarding rebar consumption, he pointed out that India will overtake the EU in 2026.
Commenting on prices, the CELSA official said that prices do not change much, noting that, in comparison with September 2024, the market remains incredibly stable and, looking at the spread between scrap and rebar, he said that it remains below $200/mt, signaling weak demand.
Turning at the end of his presentation to the challenges facing the market, Gordienko said that the same old headaches such as trade wars, weak demand, Chinese exports and CBAM remain but they are becoming larger. With more than 400 trade cases so far in 2025, the tariff situation is changing almost every week, steel exports keep flooding the market, with Chinese mills continuing to operate despite the weak demand and searching for buyers in overseas markets. In 2025, China will register a trade surplus of $1.2 trillion. Regarding CBAM, Gordienko said he expects the new tax will be around €60-90/mt and that CBAM will be finally adopted in other parts of the world as well.
AI data centers emerge as a surprising new steel consumer
Finally, touching upon a new, interesting issue, Gordienko pointed out that in the US the digital economy is emerging as a major steel consumer, with more steel set to be used to house AI than humans in the US. AI data centers will require 1.5 million mt of steel compared to 1.3 million mt required for residential buildings. Moreover, data center demand is cyclical, it does not depend on interest rates as the construction industry does. As it is built on national soil, it gives additional protection to local mills. “For every picture generated by AI means 0.2 grams of steel demand. It is less than half a paperclip, but billions of prompts turn into vessel loads of steel,” he noted.
Sluggish demand keeps European HRC market at standstill; lack of clarity on CBAM, safeguards cloud outlook
Fastmarkets’ calculation of the daily steel hot-rolled coil index, domestic, exw Northern Europe was €577.92 ($676) per tonne on Monday, up by €0.21 per tonne from €577.71 per tonne on September 26.
The Northern European index was up by €0.42 per tonne week on week but down by €0.41 per tonne month on month.
In Germany and the Benelux area, buyers estimated achievable prices at no higher than €570-580 per tonne ex-works on Monday – in line with recent deals.
German mills were offering coil with lead times of five to six weeks around €590-600 per tonne delivered (€580-590 per tonne ex-works).
In the Benelux area, offers were reported at €590-610 per tonne ex-works from integrated mills for November and December delivery and at €560-570 per tonne ex-works from a re-roller.
Trading remained sluggish in the region, however.
Buyer sources told Fastmarkets they had no immediate need to buy HRC and were holding off until there was greater clarity regarding CBAM regulations and upcoming steel safeguard measures.
One source suggested the market direction will become clearer during the Blechexpo trade fair in Stuttgart, Germany, on October 21-24.
Fastmarkets’ daily steel HRC index, domestic, exw Italy was calculated at €550.63 per tonne ex-works on Monday, unchanged from September 26.
The Italian index was up by €0.63 per tonne week on week and up by €8.96 per tonne month on month.
Local participants described the Italian HRC market as “stable”, with prices “not moving anywhere yet.”
Mills’ attempts to push domestic HRC prices up to 570-580 per tonne ex-works have been largely unsuccessful so far, according to sources.
Buyers claimed to be well-booked for third and fourth quarters of 2025, “in line with sluggish end-user demand” and therefore were not chasing for tonnages, a distributor source said.
Local and European mills were able to offer November-delivery coil.
“Mills in Europe need to sell; [they are] not desperate for orders yet, however. So, we have a standstill in the market,” a buyer in Italy said.
Buying appetite for imported coil was also limited due to the uncertainty surrounding CBAM and new trade measures.
Smaller and medium-sized buyers told Fastmarkets they were avoiding booking coil overseas due to mounting risks.
“We are not in the market to buy Asian HRC because of CBAM. And also, from other customers I’ve heard they are not buying new imports because of CBAM,” a second buyer said.
“Turkey can be a viable option because they can deliver HRC in December, but [safeguards] quotas remain a risk. Third-quarter allocations were used up quickly; I believe the same will happen with October-December tonnages,” the second buyer added.
“Because of unclear CBAM rules we basically stopped at this moment the import activities,” a third buyer said.
Offers from Turkey were reported around €520-530 per tonne CFR, including the EU anti-dumping duty, for December arrival.
From India, offers were reported at €520-530 per tonne CFR for November-shipment coil.
At the same time, offers from Indonesia and Algeria were heard at €490-500 per tonne CFR.
UK downstream manufacturer sees no support for tariffs
A UK downstream manufacturer has been rejected for government funds to modernise its operations, at a time when its exports to the US have been heavily impacted by the country’s new tariff regime, Kallanish learns.
Laurence McDougall, owner of All Steels Trading, has expressed disappointment with the lack of government support for his downstream steel manufacturing operations, which include two hot-rolling mill businesses in the West Midlands.
Special Steel Sections in Ettingshall and Bromford Iron in West Bromwich are both heavily export-oriented, with the US representing a significant market for the specialised products.
McDougall notes that some US buyers cannot afford to pay the 25% tariff, nor can they pass it onto their customers, while it is not financially viable for them to split the cost either. Around half of the customers have so far paid the 25%, which he says is creating huge inflation. The other half of his customers are “sat on the sidelines”, he adds.
“Our products are so bespoke, they haven’t got another source, there is no domestic supply,” he says.
McDougall also highlights the currently unimplemented UK-US trade deal that was previously agreed earlier in the year, with UK companies still facing the 25% tariff that was due to fall to zero.
His customers have indicated that the tariffs make costs unsustainable, threatening the viability of their own businesses.
Bromford Iron has already closed one of its two rolling mills, while Special Steel Sections is evaluating its future. McDougall has had his proposal for funds to modernise Bromford Iron’s remaining mill rejected by the government.
The proposed scheme involved upgrading the mill to modern, energy-efficient technology, converting from gas-fired furnaces to electric induction heating. This comes despite the government putting aside up to £2.5 billion ($3.37 billion) through the National Wealth Fund (NWF) for the sector as part of the Steel Strategy.
He has engaged with local MPs and government bodies, including Prism, without success.
The mills also support domestic steelmakers, historically purchasing 25,000 tonnes/year of feedstock from British Steel and 7 Steels for its rolling mills.
All Steels Trading was willing to fund over half of the total investment, with the induction heater and cooling system, being sourced from UK-based Inductotherm, representing the largest expense.
Government feedback indicated that the plan “ticked all the boxes” in terms of efficiency, carbon reduction, and supporting local jobs. However, officials advised that because the project only required £1m of funding, which was well below the £20m minimum threshold, it would not be considered.
McDougall adds that trading imports would be more profitable than manufacturing in the UK. He says he understands the government’s focus on supporting large domestic steel producers, but stresses that a downstream consumer base is critical for the future of UK steel.
In addition to this, the energy costs in his rolling mills are set to rise by 30% from 1 October, further straining margins in the sector.
Carrie Bone UK
German steel representatives react to government energy paper
Germany’s Ministry of Economy and Energy has published the “Monitoring report on the energy transition” paper, which lists ten key measures for reforming the transition process. These include pragmatism in making progress with hydrogen by reducing bureaucracy and expanding renewables and grid capacity with an emphasis on local flexibility.
In a statement by steel federation WV Stahl, its managing director Kerstin-Maria Rippel reiterated the plea for a reduction of energy costs for energy-intensive industries. Also, “in order to safeguard electricity supply in times when the wind does not blow and the sun does not shine, sufficient back-up capacities need to be available,” Kallanish hears from Rippel.
Mechanical engineering association VDMA issued a joint statement with union IG Metall. The union and VDMA section VDMA Power Systems had earlier commissioned a study of their own, which they say they see as complementary to the government’s monitoring report. Among other things, they criticise the ministry for giving too much weight to the cost factor of the transition.
“The government should not only look at the costs, but also at the preservation of jobs and the value added in Germany and Europe,” says Jürgen Kerner, deputy chairman of IG Metall. “The cost of the grid expansion will go up, and we need financial support for it in the long term.”
Christian Koehl Germany
Deadlock in EU HRC trading amid slow demand; CBAM rules still under discussion
In Northern Europe, trading was muted and mills failed to seal offers at €600 ($702) per tonne ex-works and above in deals due to slow demand.
Transactions for November-delivery HRC were reported at €580 per tonne ex-works in Germany and at €570-580 per tonne ex-works in the Benelux area, in line with buyers’ estimations of tradeable values.
“Mills’ official offers are €600-630 per tonne ex-works, but they are actually selling coil at lower levels to fill order books,” one buyer in Germany told Fastmarkets.
Buyers claimed they had sufficient tonnages of HRC in stock. They were also waiting for more clarity on Carbon Border Adjustment Mechanism (CBAM) implementation rules and new steel safeguard measures.
Sources familiar with the matter told Fastmarkets that new steel safeguards measures will be represented by the European Commission by mid-October.
But there was less clarity on CBAM rules, as reported by Fastmarkets.
Notably, emissions benchmarks and default values, methodology for recognizing carbon prices paid in third countries, and adjustment mechanisms for free emissions trading scheme allocations were heard to “remain under discussion, with publication likely only in early 2026.”
Fastmarkets’ calculation of the daily steel HRC index, domestic, exw Northern Europe was €577.71 per tonne on Friday, up by €2.71 per tonne from €575.00 per tonne on Thursday.
The Northern European index was down by €2.29 per tonne week on week, but up by €4.49 per tonne month on month.
Fastmarkets’ daily steel HRC index, domestic, exw Italy was calculated at €550.63 per tonne ex-works on Friday, up by €0.63 per tonne from €550.00 per tonne on Thursday.
The Italian index was up by €0.63 per tonne week on week and up by €10.63 per tonne month on month.
In Italy, integrated mills and re-rollers were offering November-delivery HRC at €570-580 per tonne ex-works. But such levels were not sealed in deals.
One buyer reported a bid at €540 per tonne ex-works, but said the seller rejected the bid.
“We’re in a trading dead-end. Mills do not want to sell lower than €570 [per tonne ex-works]; we do not want to buy at these levels,” a buyer told Fastmarkets.
Another mill source confirmed that it was impossible to close deals above €550 per tonne ex-works yet.
“The market is stable and not moving anywhere yet. Mills do need to sell, but not at the scale when they need to lower prices and buyers are not in a rush to book [HRC] because stocks are sufficient,” a trading source said.
Meanwhile, the market for imported HRC was also very quiet. Buyers were cautious to book new tonnages with delivery in the first quarter 2026 due to uncertainties surrounding CBAM implementation.
“The final parameters of CBAM [benchmarks, default values] will not be published until the first quarter 2026, so all imports for 2026 [delivery] is just gambling,” a second buyer in Italy said.
Still, several sources reported a large-size transaction of 40,000 tonnes of Indonesian HRC, for arrival in December, being done at €510 per tonne DDP – customs cleared, CBAM paid. Another source reported the same deal at €470 per tonne CFR.
As Fastmarkets previously reported, some Asian suppliers were heard offering to cover CBAM risks for buyers to stimulate buying appetite.
Meanwhile, offers from Turkey were heard at €520-530 per tonne CFR to Italy including the duty.
EU steel industry warns of legal gaps as Commission closes CBAM consultations
The European Commission’s three linked consultations, launched on August 28, addressed key issues including default values, benchmarks, recognition of third-country carbon pricing, and the adjustment mechanism for free EU Emissions Trading System (ETS) allocations.
Consultations closed at midnight Brussels time on September 25.
The Commission is expected to present a final draft of the CBAM regulations to be implemented in the fourth quarter of 2025.
Industry sources highlighted widespread concern about the balance between administrative burden and financial exposure. “Early preparation on data systems, verification processes, and supply-chain coordination will be crucial to manage compliance risk and competitiveness,” one distributor said.
The first consultation covered the methodology for calculating embedded emissions. Businesses will need to decide whether to provide actual plant-level data or rely on default values. While actual data can potentially lower the costs if carbon emissions are well managed, it also requires robust monitoring and verification systems. Treatment of indirect emissions, especially electricity, and the potential use of Power Purchase Agreements and Energy Attribute Certificates were key issues.
The second consultation dealt with adjusting CBAM certificate obligations in line with the free allocation of EU ETS allowances. The central debate was focused on how generous such adjustments should be, how quickly they should be phased out, and whether they might undermine the carbon price signal. Industry stakeholders tend to favor smoother, more protective transitions, while non-governmental organizations highlighted the risk of weakening climate ambition.
The third consultation concerned recognition of carbon prices already paid in third countries. Potentially, importers may claim reductions in CBAM obligations if they can prove equivalent payments abroad, Fastmarkets understands. However, verification requirements, exchange rate rules, and the treatment of rebates remain uncertain. The business challenge is ensuring documentation is accepted, to avoid paying for carbon emissions twice.
Overall, companies face tensions between the administrative complexity of CBAM and huge financial exposure.
Legal uncertainty persists
According to a notice from European steel distributors’ association EUROMETAL, emissions benchmarks, default values, and methodologies are unlikely to be published before early 2026. This leaves buyers negotiating 2025/26 contracts without a legal framework, creating risks of speculation, contractual disputes, and distortions in the single market.
In its letter to the Commission, EUROMETAL urged Brussels to:
• publish provisional benchmarks and values immediately;
• clarify the scope of downstream product coverage;
• accelerate communication on the export adjustment mechanism;
• consider a pre-payment or provisional charge at the border to stabilize markets;
• issue an EU-wide statement to reassure stakeholders before final texts are adopted.
“CBAM is not only a tax or customs issue but also a question of trade, competition and Single Market integrity,” EUROMETAL said, stressing the need for coordinated handling across Commission services.
Market impact
Looming uncertainty around CBAM rules and implementation have affected business activity in the EU flats market over the past several weeks.
Notably, demand for imported hot-rolled coil (HRC) remained quiet, with buyers taking a wait-and-see stance and assessing risks.
“Third-country imports are ruled out at the moment, no matter the offer price, because long lead times create a high risk of these goods being customs-cleared only after January 1, 2026 [when CBAM is phased in officially],” a mill source in Northern Europe told Fastmarkets.
A trading source in Italy confirmed that there was no interest in bookings of imported material at the moment owing to CBAM risks.
Some Asian suppliers were heard offering to cover CBAM risks for buyers to stimulate buying appetite.
Notably, several industry sources pointed out that Asian suppliers were normally ready to pay CBAM risks up to a certain threshold – for example, a maximum of €35 per tonne ($41).
“So, at the end of the day, you have no clue what the final import price [for HRC] will be,” a buyer in Italy said.
Some industry sources expressed hope that a lack of viable import options will result in stronger reliance on domestic coil and support a domestic price rebound.
Fastmarkets’ calculation of the daily steel hot-rolled coil index, domestic, exw Northern Europe, was €575.00 per tonne on September 25, stable day on day.
The Northern European index was down by €5.50 per tonne week on week, and down by €1.25 per tonne month on month.
Polish steel rebar prices rise slightly, but demand still poor
According to a producer source, current prices were “unsustainable” and must start to rise, alleging that prices have “bottomed out.”
“Demand is still average,” a distributor source said, adding that the market was “waiting to see” whether mills woold decrease prices in October.
Over the week, offers of domestic rebar were heard at 2,440-2,450 zloty ($669-671) per tonne CPT, compared with 2,400-2,450 zloty per tonne CPT during the previous week.
But other market sources estimated workable prices to be around 2,420-2,430 zloty per tonne CPT this week.
As a result, Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, cpt Poland, was 2,420-2,450 zloty per tonne on Friday, narrowing upward from 2,400-2,450 zloty per tonne the previous week.
Meanwhile, the market for wire rod remained quiet this week.
Fastmarkets’ weekly price assessment for steel wire rod (drawing quality), domestic, delivered Poland, was 2,580-2,650 zloty per tonne on Friday, unchanged week on week.
EU imposes definitive anti-dumping duties on HRC from Japan, Egypt, Vietnam
The new measures, which were confirmed on Thursday through their publication in the Official Journal of the European Union, also included the termination of the investigation into imports from India, after concluding that no dumping had been established for Indian hot-rolled flat steel.
Duty rates and margins
- For Egypt, the definitive dumping margin was set at 11.7 % for Ezz Steel and for all other Egyptian imports, a little lower compared with the provisional duty of 12.8%.
- For Japan, definitive duties were imposed at: 30.0% for Nippon Steel Corporation and all other companies (down from 31.8% provisional duties); 29.8% for JFE Steel Corporation and Daido Steel Co (down from 31.1% provisional duties); and Tokyo Steel received a comparatively low duty of 6.9%, unchanged from the provisional duty.
- For Vietnam, the definitive rate were set at 12.1% for Formosa Ha Tinh Steel Corporation and all other companies, in line with the provisional rate.
Procedure, rationale
The investigation into HRC imports from Egypt, India, Vietnam and Japan was initially launched in August 2024 based on a complaint by the European steel association EUROFER. After the imposition of provisional measures in April 2025 for all countries except India, interested parties submitted comments, while the Commission carried out further verification and adjustments.
Market impact
All countries under investigation, except Vietnam have been using their quarterly quotas at a slow pace.
India, Egypt and Vietnam used less than one-third of their quotas for the July-September quarter and by September 26, Egypt still had 77,669 tonnes of its initial 112,716 tonnes allocation available, Japan still had 86,949 tonnes of its initial 112,716-tonne allocation available and India had 103,656 remaining from its HRC allocation of 227,781 tonnes.
Vietnam, however had fully used up its 112,716 tonnes quarterly quota by September 26.
The four countries combined supplied 3.9 million tonnes of HRC to the EU in 2024, accounting for 41.2% of total HRC imports to the trading bloc, according to Global Trade Tracker statistics.
Sources told Fastmarkets that, apar from the investigation into imports from those four countries, looming uncertainty regarding new steel safeguards and the EU’s Carbon Border Adjustment Mechanism (CBAM)were cooling buying appetites for HRC imports.
“CBAM and safeguards are both looming large, so importing [HRC] in general is a risky business,” a buyer in Italy said.