European long products producers find themselves in dire financial straits. In the absence of government intervention amid the enduring market slump, producers may be compelled to shutter operations or offload select capacities. The confluence of meager profitability and soaring costs continues to exert a detrimental influence on production in both southern and northern Europe.
Producers of long products are flagging exorbitant electricity expenses and escalating scrap prices as major challenges. To mitigate these costs, they are adopting measures such as production curtailments and night shifts to economize on electricity consumption.
A market insider noted that prevailing selling prices for long products are volatile and resistant to upward adjustments. Wire rod and rebar sales are dwindling across Europe, with both product categories currently struggling. Notably, Germany is witnessing a persistent decline in sales volumes and prices.
In southern Europe, European rolled steel producers are contemplating production halts as a cost-cutting strategy to reduce scrap procurement.
With current indicators failing to signal a forthcoming recovery, market projections point towards 2025 mirroring the challenges of the present year, albeit with some modifications. Nonetheless, a resurgence in demand is anticipated in the latter half of the upcoming year.
A long products producer with operations spanning various European nations hinted at a potential structural decline in the market's long-term trajectory.
The European steel distribution sector is also confronting significant pressures. Reports suggest that numerous service centers throughout Europe are grappling with hardships and could potentially face closures.
As highlighted by the Ronsco Center in October 2024, the global rebar market exhibited divergent price trends across regions. Turkey witnessed price hikes driven by escalating scrap costs and steady domestic demand, while the US experienced a downturn in prices attributed to subdued demand amid economic uncertainties. In Europe, growing competition from imported products exerted pressure on the market.