European steel scrap market faces uncertainty amid sluggish demand

According to a recent market update from MEPS, a leading steel market analysis firm, European steel scrap prices remain under downward pressure due to weak demand and limited export opportunities.

MEPS reports that the sluggish pace of production among steelmakers has curbed demand for scrap across much of Europe. Many mills are operating at reduced capacity, choosing to purchase only what is necessary for their immediate production needs. This cautious buying behavior has contributed to price stagnation or, in some cases, further declines.

The situation is further compounded by subdued overseas demand. MEPS notes that lower-than-expected buying interest from key export markets, such as Turkey, has limited the ability of European suppliers to offset weak domestic activity. “European exporters face growing challenges,” MEPS states, “as Turkish mills reduce their scrap purchases amid currency fluctuations and soft finished steel demand.”

Seasonal factors are also playing a role. While historically the arrival of spring brings increased construction activity—and with it, higher demand for reinforcing steel and associated inputs—MEPS suggests that any seasonal uplift this year may be limited. Broader macroeconomic conditions and ongoing geopolitical uncertainties continue to weigh heavily on the market outlook.

Despite these headwinds, MEPS analysts believe that the market could begin to stabilize if production levels recover or export conditions improve. However, until a more sustained recovery in demand is visible, scrap suppliers are likely to remain cautious.

Source: MEPS, Photo: Fotolia