The strength and sustainability of the much discussed economic upturn preoccupied speakers at the BIR Ferrous Round Table in Amsterdam.
Mr Christian Rubach divisional president of Germany based Interseroh Hansa Recycling GmbH said that "So far, this seems to be based on restocking of inventories and or the result of stimulus packages and other governmental programs." He added that and over the coming years, the Western economies appear likely to suffer significantly slower growth rates than leading developing nations.
Mr Blake Kelley of Sims Metal Management said that idled excess capacity remains an overriding issue in the steel industry and so, despite consolidation, the sector’s product prices are unlikely to increase to sustainable levels any time soon. He added that "But in the meantime, lower volume makes it very difficult for scrap processors and steel producers to effectively amortize their costs." He added that scrap prices are likely to continue easing downwards until demand and supply return to balance, possibly by late December buying but more probably not until January.
The EU report from Mr Markus Barg of TSR Recycling in Germany confirmed that "One year of crisis with production cuts of more than 40% has certainly left its mark on the financial situation of our customers, their margins seem to be healthy, but the volumes are missing."
According to Mr Andrey Moiseenko of MAIR in Russia, domestic scrap collection volumes amounted to around 2 million tonnes in September this year, a decline of around 30% as compared to 2008. However, October is likely to see the highest collection total of the year to date.
The Ferrous Division’s guest speaker Dr Thomas Ludwig CEO of German steel distributor Klöckner & Co SE also warned that real demand for steel has shown no signs of a major recovery and could remain at low levels for some time. Without a rapid improvement in real demand, steel prices are likely to remain highly volatile in the coming years.
Finally, Mr Ikbal Nathani of India’s Nathani Group of Companies emphasized the concerted efforts of BIR, ISRI and the newly formed Metal Recycling Association of India to convince the Indian government that ferrous and non ferrous scrap should not be classified as hazardous waste. He said that current proposals threaten scrap exports to the country.
