Difficulties lie ahead for the ferrous metal sector, according to BIR ferrous division president Christian Rubach.
In his introduction to the latest BIR Ferrous Division World Mirror, the TSR senior consultant, warned that financial problems seem to be a reality for the whole industrial sector.
He added: “On the other hand, the economic outlook for the eurozone and for the USA seems to have improved. Nevertheless, the world steel markets – and especially that of the eurozone – are still in a more or less poor condition despite the brighter outlook. Without the Chinese economy as a locomotive over the coming months, the prognosis is not so promising for our business.
“Let us not forget that China provide the turbo engine in 2003/04 when scrap prices surged to levels never seen before.
“I fear that our industry will still be in troubled waters over the next few months and that problems surrounding overcapacity and gross margins will continue to prevail.
“Another difficulty for our industry will be balance sheet issues facing those companies which made huge acquisitions or financed mergers some five years or so ago. Restructuring of those deals is in the air and our industry will not be the same in three years’ time. Saying that, I have no doubt that our recycling business will be one of the most prosperous within the next decade.