Soft demand and overcapacity issues have been nagging the steel industry, Berlin Metals president Roy Berlin said.
The international steel industry currently has about 25 percent overcapacity for most products, largely since China has continued to add mills even though demand hasn’t kept pace.
Overcapacity puts downward pressure on steel prices worldwide. Steelmakers have struggled to make money, since they still have high input costs for coke, coal and other materials.
“Demand has improved since the Great Recession, but we’re not back to where we were,” he said.
Auto sales have been a bright spot, but the automotive industry only accounts for about a fifth of the demand for steel. The housing market also has rebounded, and that’s buoyed demand a little since steel goes into windows and new appliances.
“Overall, manufacturing is doing a little better this year than last year,” he said. “But it’s incremental.”