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Ferrous scrap prices sag in Germany on
excess supply and lower export demand


Ferrous scrap prices fell in September.
24.09.2018 − 

In their September price negotiations with scrap dealers, steel mills were occasionally able to achieve considerable price markdowns. "They had the upper hand," one merchant told EUWID.

During the summer months, steel mills generally shut down operations for one to three weeks. In Italy, the shutdowns ran for all of August. By the end of summer, the scrap dealers had built up large inventories, and supply therefore exceeded demand. At the same time, the sharp decline in export prices for ferrous scrap put downward pressure on the price level in Germany. 

Scrap arisings are high at the moment. There were only minimal production stoppages this summer in the automotive and heavy machinery industries and arisings of new scrap remained good, said one trader. Moreover, construction activity remained robust, resulting in a lot of industrial and demolition scrap becoming available. However, traders are unable to get the material off their hands. One of the biggest problems for the scrap yards is low water levels in German rivers. At most, ships can only be loaded to half capacity, doubling the freight cost per tonne. "The loading stations are bursting. We cannot get the material shipped,” complained one respondent. Since there continue to be limited logistical capacities at freight forwarders and in rail traffic, there is also no chance of diverting these volumes to the road or rail system instead, according to respondents.

Germany’s national rail network, Deutsch Bahn, is reportedly feeling the full brunt of the shortage of railcars and locomotives that has been a cause of complaint since the beginning of the year. "Hundreds of railcars have accumulated at some railway stations because Deutsche Bahn cannot put block trains together,” criticised one merchant. Some steel mills are also having problems shipping out their products.

The full market report including the price changes in September appears in the next issue of EUWID Recycling and Waste Management on 4 October 2018. Online subscribers can already access the report here: EUWID Ferrous Scrap Market Report for Germany

 

 

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