The global long steel market remains under pressure from subdued demand, while higher energy costs, supply disruptions and tighter trade restrictions are supporting prices, according to the International Rebar Producers & Exporters Association (Irepas).
Global crude steel production fell 0.3pct YoY in July, compared with a 1.7pct increase in June, while China’s output declined 3.6pct. However, production in January-July was down only 0.6pct, indicating that supply has yet to meaningfully rebalance.
Irepas said geopolitical developments in the Black Sea and Strait of Hormuz are making international trade more difficult, while higher natural gas, electricity and coal prices are adding to production and logistics costs.
China’s steel exports remained above 10 mln tons in July, with bar exports rising 20.9pct YoY. Tighter EU and UK import quotas are expected to redirect more Chinese material toward other markets rather than resolve the underlying supply imbalance.
In Europe, demand remains weak, particularly in construction, but higher energy and transportation costs are pushing steel prices higher. The current price increase is therefore mainly cost-driven rather than supported by stronger consumption.
The US remains one of the stronger markets, with domestic steel shipments up 5.3pct in the first half of 2026 and imports down 22pct year to date. Infrastructure and technology investment is supporting demand, although high interest rates continue to weigh on construction.
Irepas expects global steel prices to remain under upward pressure in the coming quarter, driven mainly by supply-side factors, higher costs, trade restrictions and geopolitical disruptions rather than a broad recovery in demand.
India, Southeast Asia, Africa and selected US construction segments offer the strongest opportunities for long steel products, while global steel demand is expected to improve further in 2027. However, the association said there is no broad recovery yet.
The ferrous scrap market remains weak as mills seek to protect margins, while competition in the global longs market has eased due to fewer viable supply sources. Irepas described the current market as highly unstable and sensitive to geopolitical developments, particularly in the Black Sea and Middle East.