IREPAS: Negative outlook for global longs market at beginning of the year
The year 2025 has not started off on a positive note, with a plethora of challenges facing the global longs market according to the most recent report by IREPAS, the worldwide association for longs exporters and producers. The report highlights issues such as weakened demand, protectionist actions, and excess capacity as key factors placing increased pressure on the market.
China, a major player in the steel industry, saw record steel exports in 2024. However, the country continues to grapple with economic uncertainties as it struggles to stimulate domestic steel demand in 2025. This ongoing struggle in China is expected to have a significant impact on the global steel market.
The global economy is bracing itself for further obstacles in the coming months. President Donald Trump has threatened to impose a 25 percent tariff on imports from Canada and Mexico to the US. This action could potentially harm industries like construction, which are already facing challenges due to inflation and low demand. Additionally, the mass deportation of undocumented workers by Trump’s administration could compound the issue by causing labor shortages.
The economic landscape in Europe remains bleak compared to the end of the previous year. The region continues to experience negative growth, and protective measures are set to be revised by the EU on April 1. Meanwhile, Turkey and India have also implemented their own trade measures, further complicating the global steel market.
In conclusion, IREPAS emphasized that the global long steel markets are entering a period of unprecedented uncertainty. Intense competition, weak demand, and an unstable outlook characterize the current situation. Some clarity may emerge after Trump’s inauguration on January 20 and following the Chinese New Year holiday.
Looking ahead, Fitch Ratings anticipates an increase in apparent steel consumption in 2025. However, challenges persist, with the need for steelmakers to implement more comprehensive decarbonization strategies according to the OECD. Worldsteel has revised down its global steel demand outlook for 2024 but expects a rebound in 2025. BHP forecasts a slight uptick in global steel output for the rest of 2024.
Overall, the global steel industry is facing a multitude of challenges and uncertainties in the year 2025. The impact of various political and economic factors, along with changing global dynamics, will continue to shape the industry landscape in the coming months. It remains to be seen how key players like China and the US will navigate these challenges and steer the industry towards stability and growth.
