The global ferrous metals market is facing significant challenges due to a combination of supply shortages and declining demand. Disruptions from severe weather and industrial slowdowns have worsened the situation. According to the Bureau of International Recycling’s (BIR) February 2025 report, the global supply of recycled steel has been hit hard, especially in countries like the United States, Germany, and the U.K.
Disrupted Supply: Weather and Stockpiling Impact Recycled Steel Flow
In the U.S., harsh winter weather has disrupted the flow of recycled steel, driving prices higher. This issue is not confined to North America. In Germany, the recycled steel market encountered difficulties in the fourth quarter of 2024, as stocks along the value chain fell to historically low levels. Denis Reuter of TSR Recycling reported that many consumers stocked up, contributing to reduced supply availability and uncertainty.
Similarly, in the U.K., Enicor’s Tom Bird noted that material supplies remained tight, with operators facing low incoming supply levels. This widespread supply shortage indicates broader challenges in global recycling markets.
Declining Demand: Weaker Steel Markets Across the Globe
While supply shortages remain a problem, a decline in global demand for recycled steel has added to the market’s struggles. In Germany, weak demand in the automotive sector has been a major factor. Mogens Bach Christensen of H. J. Hansen Genvindingsindustri in Denmark highlighted that the automotive slowdown has directly impacted the recycled steel market.
In Japan, domestic recycled steel markets remained weak in the final quarter of 2024. Ted Taya of Shinsei Scrap Co. Ltd. observed that many steelmakers had adopted a “wait-and-see” approach, reflecting the market’s uncertainty. Similarly, in Taiwan, the demand for scrap steel dropped sharply. Michael Gaylard of Sims Ltd. noted a 12% drop in Taiwan’s recycled steel imports in 2024 due to factors like high power costs and the preference for cheaper billets.
Impact of Tariffs: Uncertainty Looms Over Global Steel Trade
The global steel market also faces ongoing uncertainty due to tariffs. While a trade war has been avoided for now, the potential for new tariffs on steel imports continues to loom. George Adams of SA Recycling warned that such tariffs could severely impact consumer demand, which is vital for the stability of the market.
Shane Mellor of Mellor Metals Ltd. raised concerns over the effect of U.S. tariffs on global steel prices. Higher tariffs have previously strained steel-producing nations like Brazil and Turkey. These tariffs have added to the volatility in the global steel market.
Turkey Leads Scrap Imports, While Other Countries Reduce Purchases
Despite these challenges, Turkey continues to dominate as the world’s top importer of ferrous scrap. In the first nine months of 2024, Turkey imported over 15 million metric tons (mmt) of recycled steel, marking a 6.4% increase compared to the previous year.
On the other hand, other major importers like India and Vietnam saw declines in scrap imports. India’s imports dropped by 17%, while Vietnam saw a smaller decrease of 3.6%. These reductions indicate a shift in the global demand for recycled steel.
Looking Ahead: A Tough Road for the Ferrous Metals Market
The global ferrous metal market faces a tough road ahead. Ongoing supply issues, weakening demand, and uncertainty around tariffs could significantly impact the steel industry in the near future. As the market adjusts to these challenges, stakeholders must navigate the disruptions to maintain stability and ensure continued production and trade.
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