Double whammy of Chinese exports and Trump uncertainty binds long steel

The global long steel products market continues to be very difficult to operate in, according to Irepas, the international association for producers and exporters of rebar. Its latest short-term outlook expects the next quarter to be very unpredictable and unstable.

Irepas says the global long steel products market is under very strong pressure because of Chinese exports, exacerbated by the arrival of President Donald Trump in the White House bringing ‘uncertainty, volatility and a lack of visibility’.

‘It seems like the situation will get even worse until the dust settles and his goals are clearly understood. So far, Trump’s announcements have given rise to concerns about inflation, which will slow down interest rate cuts.’

Waiting game

Specifically, the outlook says the US market is awaiting the outcome of decisions already made by the White House and others under consideration or delayed for further negotiations.

‘New infrastructure projects are on hold, amid the government freeze on spending. Interest rates have not come down and there is no clear sign for the near future, thus delaying many projects and also purchases by would-be home buyers. Labour shortages in the construction sector are becoming a near certainty, causing delays and higher costs for construction developments.’

Meanwhile, the outlook believes the industry must await China’s policy in the year ahead, asking whether it steel exports will continue to exceed 100 million tonnes or slow down to help stabilise the global market.

EU demand low

In Europe, theEU steel market is reported to be suffering from continuing low demand for long products, with European mills locked in a cycle of poor demand and high costs. Meanwhile, energy prices in Europe are back up at levels not seen since 2022.

Higher costs will force long steel producers in the EU to increase prices and to shut down more capacities in 2025, Irepas maintains. The EU’s import quota for ‘all other countries’ was exhausted early at the start of the year, with large volumes imported by Bulgaria and Romania. This means there will be no more imports from such countries.

Mills in the long steel products market are being forced to lower their capacity utilisation rates, which will negatively affect their cost of production. The outlook warns of a chain reaction of displaced export capacities due to Chinese exports. 

In conclusion, Irepas says: ‘Under these circumstances, the current status of the market can be described as unstable and very difficult to operate in. The outlook for the next quarter is very unpredictable and unstable.’