In the latest BIR World Mirror from the Ferrous Division, he warned that volatility is here to stay.
He said: “Discussions about overcapacity in the steel industry are spreading again after not having been an issue, publically at least, since 2003/04. The President of Eurofer estimates today’s overcapacity in the EU is up to 25 per cent or 50 million tonnes. Other experts estimate overcapacity in China to be 300 million tonnes in the long run.
“The markets are changing dramatically, as can be seen for example, from ThyssenKrupp’s change of strategy as the company is in the course of selling its completely new plants in Brazil and the USA.
“Other players are entering the international markets, for example Russia. As Russia becomes a member of the World Trade Organisation from September 2012, it will no longer limit its steel exports by quotas.
“Volatility in the steel markets is expected to increase still further. The result for our industry will be dramatic changes as well. The EU-27 has overtaken the USA with regard to scrap exports to third countries.
“On an annualised basis, the EU is exporting 25 million tonnes per annum – a level which has never been seen before. This fact shows once again the extreme importance of free and fair trade and of open markets.”