Irepas is pessimistic for the first quarter of 2023

The International Rebar Producers and Exporters Association (Irepas) says the first quarter of 2023 may be the worst quarter for the global longs market in a long time amid rising raw material costs, higher energy prices and declining business activity.

Although producers will close 2022 with strong gains thanks to the first six months of the year, they will have to reduce production further next year to minimize losses on their balance sheets. Also, if they continue to maintain their production levels and sell at a loss, they will likely face commercial measures. "In these conditions, it will take some more time to see a new supply-demand balance in the market," Irepas said in his December short-term outlook.

"Steel buyers in the EU market are starting to get nervous about what will happen after the holidays, as the longer renewals expected by the producers will likely limit supply," Irepas said. Construction demand will pick up sooner and will help producers raise their prices. Energy prices will ultimately form the basis of everything."

In the US, Irepas predicts that the new Buy American investment package will come into effect from January 1 and "will be a huge challenge for the EU". “A new trade war may be imminent.” In China, meanwhile, the "quiet" possible liquidation of the zero-Kovid policy could lead to increased steel demand after the Lunar New Year.