EUROMETAL at YISAD: Europeans don’t necessarily relay on imports for the supply of FLAT Steel products

At the 7th YISAD Flat Steel Conference & SteelOrbis Market Talks held in Istanbul on April 30, Alexander Julius, presidency member of the European association of metals distributors and service centers EUROMETAL, said that in the second half of 2018 apparent steel consumption in the EU rose by 1.4 percent, while imports rose much more strongly, by 15.3 percent, despite of preliminary safeguards, while EU domestic steel supplies fell by 2.5 percent, all year on year. According to EUROMETAL, the share of imports in the apparent steel consumption in the fourth quarter of 2018 totaled 25 percent, while the 2.6 percent rise in steel demand in 2018 benefitted mostly third-country suppliers with imports rising by 12.3 percent. Mr. Julius stated that apparent steel consumption in the EU is forecast to increase by only 0.5 percent in 2019, followed by a 1.2 percent rise in 2020.

According to Mr. Julius, Europeans are not in need of imports, with all of their demand being supplied by EU steel mills and steel service centers. He went on to say that non-EU supplies have no major impact on the supplies of EU steel service centers. The EU steel service centers remain cautious in view of unpredictable price developments, lower demand and the short lead times of European supplies versus longer import lead times, he said.

Commenting on Turkey’s exports, the EUROMETAL official pointed out that, in addition to replacing blocked competitors, higher Turkish exports have been driven by the poor domestic economy in Turkey, which is likely to continue in its current state. He said that, although Turkey is making efforts to diversify its export markets, it faces barriers in several markets, including the high-growth markets in Asia. He underlined that not only Turkey but also others are having the same thought and are exploring alternative countries, resulting in shifting of competition to those countries where there is tremendous price pressure and low consumption volumes.

Mr. Julius stated that, if the UK leaves the EU, all the trade agreements between the UK and every other single country will be invalid and this also applies to trade measures, which will have to be reviewed. He pointed out that most of the steel-related safeguard measures will be copied from the EU and out of 72 trade measures, 42 will remain in place. On the other hand, the EUROMETAL official said that the EU will need also to modify its trade measures if the UK leaves because they were designed for 28 states.