Posted on 17 Feb 2025
Scrap prices are likely to remain in the $340-360/tonne cfr Turkey range by the end of the first quarter, while a significant steel demand rebound is unlikely this year, was the view of the majority of panellists at Thursday’s Kallanish Steel Scrap 2025 conference in Istanbul.
US tariffs will likely raise US domestic scrap prices at first, but buyers will stop paying once they reach a certain level and values will come down, said Colakoglu Metalurji purchasing director Koray Gunay. The US is advertising tariffs to start from a strong position in trade negotiations. If it really imposes a 25% levy on everything, “this will be weird for their market … I think exclusions [from tariffs] will gradually come and prices will come down,” Gunay commented.
As for demand, Gunay is sceptical of a construction revival in Turkey, given that “not much has happened” since the catastrophic earthquakes two years ago. Syria will also see only a slow recovery post-Bashar al Assad. “And who is going to pay for it?” Gunay asked of the funds needed for Syria’s reconstruction.
Chinese steel exports should not remain in 2025 as high as they were in 2024, due to multiple trade cases against China as well as US tariffs, but nothing is certain, pointed out Hangzhou CIEC International’s general manager Middle East Office, Yasin Kanbur. So long as Chinese domestic demand remains weak, exports will be necessary. Despite China announcing support worth billions of yen for major real estate developer Vanke last week, “it had zero impact because of the market reality,” he added.
Chinese local scrap generation will rise 30% by 2030 to 350 million tonnes, but scrap exports are unlikely as China is more interested in securing its supply, Kanbur noted.
India has implemented three policies designed to simultaneously improve domestic scrap processing infrastructure. Scrap hitherto generated in the “informal” sector will go into formal processing and be registered in statistics, noted Material Recycling Association of India (MRAI) secretary general Amar Singh.
India is nevertheless an “opportunistic importer” and will continue to source foreign scrap. Demand has recently fallen simply because of the large Indian import volumes of Chinese steel, Singh added. He is hopeful of strong Indian steel demand in the next fiscal year thanks to substantial infrastructure project allocation in India’s recent budget.
The impact of US tariff exemption removals on supply into the US of steel hitherto enjoying exemptions, as well as whether China will continue to depress global prices are the key factors of uncertainty for 2025, Gunay concluded.
Source:Kallanish
