The president of Germany’s steel stockholders’ federation Bundesverband Deutscher Stahlhandel (BDS) Oliver Ellermann believes that the next decade will not be disappointing for the country’s steel distributors.
In his essay [sic] entitled ‘Are there Golden Twenties coming?’ he refers to a study by research institute Prognos Deutschland, which predicts an annual growth in gross domestic product by on average 1.5%.
One of the roles of distribution in the steel value chain he says is the immediacy of availability of supply and a “… price cleaning function,” which smooths oscillations in pricing. “Price hikes by the mills are handed on by distributors with a delay, while price reductions are handed on immediately and shared with the users.” This is an observation that results from 33 years in the trade, he explains to Kallanish.
E-commerce webshops are “… nice to have”, he writes, but they will not replace the current structure of people dealing with one another in the specific B2B sector of steel. Regarding the current dispute on international trade flows, he defends distributors against criticism from some quarters that the sector acts in an opportunistic way. “We do care where steel comes from,” and “… only steel production that is close-by will give distributors competitive advantages,” he says, citing transport advantages, know-how and easy communication.
Ellermann assumes that Donald Trump will be re-elected next year in November, which will also mean a continuation of trade measures, he says. “We will remain very busy tracking contingencies and quotas,” he says