Global long steel demand has become marginally lower since June due to geopolitical developments affecting the Black Sea region and the Strait of Hormuz, the International Rebar Producers & Exporters Association, or Irepas, said in its latest short-term outlook issued Sept. 3.
Disruptions to supply and logistics have been creating upward pressure on prices, the association said.
Irepas noted a combination of relatively weak demand and rising costs and supply-side pressures, which are creating considerable uncertainty and volatility in the international steel market.
From a pricing perspective, the main supportive factors are the prospect of reduced supply pressure from China, disruptions affecting trade in the Black Sea and the Strait of Hormuz, higher energy and production costs, and the increasingly restrictive trade measures being implemented in the US, EU and UK, Irepas said.
The association is expecting prices to remain under upward pressure during the next quarter driven primarily by the supply-side factors rather than by a strong recovery in underlying demand.
“On the demand side, the picture is less encouraging,” Irepas said, drawing attention to no evidence of a broad global demand recovery yet.
Global demand growth is projected to remain sluggish at around 0.9% per year through 2030, with the conflict in the Middle East, rising energy prices and disruptions in supply chains adding further headwinds, according to a recent report by OECD June 4.
“As the gap between steel production and capacity widens, utilisation rates will remain low and may slide from 76% in 2025 to 74% or less in 2028, intensifying financial pressure across the steel industry, OECD Steel Outlook 2026 report said.
The ferrous scrap market, meanwhile, remained weak without much movement towards the upside as steel mills sought to avoid price hikes that would further constrict their margins, Irepas said.
Turkish deepsea import scrap prices remained stable on Sept. 3. Platts, part of S&P Global Energy, assessed Turkish imports of premium heavy melting scrap 1/2 (80:20) at $380/mt CFR on Sept. 3, unchanged day over day.
“Under such circumstances, the current status of the market can be described as very unstable. The market will remain highly sensitive to geopolitical developments, particularly in the Black Sea and the Middle East,” Irepas noted.
Author: Cenk Can
