The last ten months of 2021 turned out to be unexpectedly favorable for steel producers - prices for rolled metal products grew faster than prices for raw materials, and demand provided full order books. However, this boom is the result of one-off confusion.
- The steel market is a very complex mechanism and many cost drivers, including those related to EU, US and Chinese policies, will remain for a long time.
- Steel for the automotive industry in August 2021 cost $ 1,300 per ton.
- The protective measures were aimed at improving the situation of European steel producers. However, this goal is not being met, as production in the EU is falling. Imports in the EU from third countries are also falling.
Steel prices have skyrocketed in recent months. These few months are perhaps the strangest period in the history of the world economy, apart from, of course, wars, although, admittedly, the situation was a bit similar to them. It suddenly became clear that industrial enterprises cannot work harmoniously at different times in different parts of the world, the borders for people and goods are closed, transport is stopped.
For the modern economy, which operates without multi-day inventories, relying on frequent supplies of materials and components for production, this has proved to be a paralyzing blow. The second quarter of last year is essentially a collapse, from which we still have not fully emerged.