Nov 17, 2023
Assofermet: Decarbonization, energy costs and rising interest rates to continue affecting scrap market in 2024

Assofermet, the association representing Italian distributors of scrap, has issued a press release regarding the market outlook for 2024 after the FT Mercati event sponsored by Assofermet itself. The focus of the event were economic forecasts for the national and international metal, steel and scrap markets.

According to the forecasts, next year's global economic trend will return to pre-pandemic levels, growing by 0.5 percent each quarter and reporting a decline in inflation of about three percent. An impasse in metal scrap prices is also expected. “The main challenges and trends that affected the international economy in 2023 will continue to influence the scrap market in 2024: decarbonization, energy costs and rising interest rates”, said Cinzia Vezzosi, vice president of Assofermet.

Decarbonization is affected, on the one hand, by the urgent timing imposed by the European Union, and, on the other, by the possible agreement between US and EU that would further restrict steel and aluminum imports, causing a major price hike.

Furthermore, rising energy costs are by now integral parts of global market trends, as they are absorbed in commodity prices.

Speaking at the same event Emilio Rossi, senior partner at Oxford Economics, said the forecast for the 2024 global trade trend is again similar to pre-pandemic levels, with quarterly growths of 0.3 percent and a global annual rise of three percent. The issues that had marked the pre-pandemic period, namely, the declining population, rising public debt, and low manufacturing growth, could also return. Meanwhile, decarbonization and inflation are foreseen to remain higher than the levels of the past decade until 2030.

Source: Steel Orbis