Posted on 31 Jul 2019
The new scrap that accrues from car production as feed material for the steel industry in Germany has seen a dramatic drop, Kallanish learns from industry sources.
According to the scrap buyer of a large German mill, “… the volumes put out to tender by automotive companies are exactly -25% lower than they were last year.” The carmakers put their volumes out to tender on a quarterly basis, and third quarter 2019 volumes have just been commissioned. This is a figure that often remains unconsidered in crucial forecasts for the steel industry, he says.
Germany’s car manufacturing industry association, Verband der Deutschen Automobilindustrie (VDA), has just flagged up an increase in sales in the German car market. New registrations dropped in nearly all main European markets, but they rose 1% year-on-year in Germany. While the VDS data refers to registrations, the buyer notes however that “… this means little for actual production. It’s just cars sold now but made last year.”
In the meantime, large volumes of cars are rumoured to be parked on Germany’s largest construction site, the new Berlin airport BER Schönefeld, which may still be supplied to boost the new-registration figures. But for the mills that are close to the automotive industries, it means times of under-utilisation are here, the buyer notes.
Prices for newly arising scrap (grade 2/8) this month in Germany were -7% down on June, to an average of €232.50/tonne ($259/t), according to scrap federation BDSV. Since this year’s scrap price peak in March, the development of grade 2/8 has not stood out from other types, which across the board fell on average by around €24/t.
