The prediction points to further bad news for UK metal recyclers who have already been hit by falling prices and demand for scrap for new steel production from overseas (see letsrecycle.com story).
He told delegates at the event, which was held in Dusseldorf, Germany, that there would be a slow increase in stainless steel output and demand for stock replenishment towards the end of 2009, but, for Europe, stainless steel production would only reach 7.6 million tonnes in 2008, compared to 8.1 million tonnes in 2007.
And, Mr Wright, who is chief operating officer at ELG Haniel, revealed that the “best estimate” for 2009 production was less than seven million tonnes.
The impact of the fall in demand for scrap steel was made clear with Corus' announcement at the start of this week that it is now offering £0 per tonne for steel cans and packaging delivered to one of its CanRoute centres (see letsrecycle.com story).
The poor situation with regards exporting to China and India was emphasised at the meeting, with Mark Sellier of German-based KMR Stainless BV reporting that China had not completed any significant imports of stainless scrap in the third and fourth quarters of this year.
At the same time, Anand Gupta of Ambica Steels told the committee that Indian domestic producers had cut their production of new steel by an average of 30-40%.
The state of play for ferrous metals as a whole was made clear at the meeting of the Ferrous Division, where Kevin Fitzpatrick of SIMS in the UK described the “unprecedented” pace of price declines in the EU scrap market.
Mr Fitzpatrick told the event that the market was expecting a 60% drop in ferrous scrap demand in the fourth quarter, with yard infeed volumes also falling by 30%.
Non-ferrous
With prices for non-ferrous metals also falling markedly in recent weeks, the picture painted at the BIR Non-Ferrous Metals Division Round-table event was equally bleak.
The president of the division, US-based Robert Stein, told the meeting that recyclers had been experiencing “huge losses” as a result of inventory revaluations, while scrap suppliers had been forced to agree to their customers' demands for contract renegotiations.
He stated that while many buyers “simply won't survive” without concessions from sellers, at the same time “some suppliers may not survive because of them”.
Mr Stein's comments echo sentiments made by the BIR last month, which warned about the negative effects of “unethical” buyer behaviour (see letsrecycle.com story).
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