Now that the summer holiday period has begun, most people in the Benelux will read this Mirror publication sitting at the pool or on some sandy beach. Over the last couple of years, there has been a steady rally leading into the holidays where most yards would try to liquidate inventory. This year, however, has been remarkably different as conditions in general have remained fairly quiet in the face of limited/sporadic demand.
What has been seen over the last couple of weeks is not much different to what has happened so far in 2019 - in other words, it has been fairly quiet for the most part. General uncertainty continues to be fuelled by ongoing trade issues involving the USA and China, as well as Europe. These have put a damper on economic growth prospects and are impacting various industries, with the automotive sector struggling most noticeably. Unclear policies or lack of information about what type of car to choose are prompting consumers to postpone their decision until greater clarity is provided.
Furthermore, the stricter scrap import stance adopted by some of the alternative South East Asian markets is sending traders back to the drawing board again to try to figure out how to navigate the many challenges facing the recycling industry following the policy shift in China. At the same time, mills, foundries and refineries are well-stocked with various grades of material, resulting in very soft demand for units. This is definitely so for copper and aluminium. And although there is demand for zinc owing to a depressed Zn market, people are preferring to hold on to metal until the market recovers to an acceptable level; of course, this is on condition that zinc units are available. There seems to be no shortage of insulated copper wire while demand for chops is almost non-existent.
In general, supply and demand are experiencing a serious disconnect: there is material available but people are pushing away potential business opportunities owing to a lack of sales options.
Metallo Belgium N.V., Board Member of the BIR Non-Ferrous Metals Division