Posted on 03/11/2008 in category Convention

 

PRESS RELEASE

FOR IMMEDIATE RELEASE

Brussels,3 November 2008

BIRAutumn Round-Table Sessions

Düsseldorf,30-31 October 2008



 

Non-FerrousMetals Division:

TrulyChallenging Market Conditions



Inrecent weeks, twin forces have been acting upon the recyclingindustry to create truly challenging market conditions, it wasexplained by Non-Ferrous Metals Division President Robert Stein ofUS-based Alter Trading in his opening address to the Round-Tablemeeting in Düsseldorf.

Onthe one hand, recyclers have been experiencing “huge losses” dueto inventory revaluations. On the other, scrap suppliers have beenforced to acquiesce to customer demands for renegotiation ofcontractual terms and have even been on the receiving end of“outright and arbitrary cancellations”. While recognising thatmany buyers “simply won’t survive” without such concessionsfrom sellers, he went on to underline that, in turn, “somesuppliers may not survive because of them”.

Whilemany scrap purchasers have “very real needs”, said Mr Stein,“there are always those who take advantage of situations like this,and that is reprehensible and absolutely inexcusable.”

MrStein described the performance of trading partners as “the singlemost challenging factor in the well-being of our industry”. He alsoargued that the recent “profound” change in market conditionswould lead to a re-distribution of secondary metal shipments aroundthe world. In this context, he added, the Non-Ferrous Metals Divisionis working with the newly-formed BIR International Trade Council toestablish statistical procedures to monitor scrap flows.

Inhis summary of the world non-ferrous metal markets, South Africa’sMark Sellier of KMR Stainless BV reported that some customers havebeen prepared to walk away from business despite having paidsubstantial deposits only a few weeks earlier. The volume of scrapflowing into many processors’ yards has been dramatically reducedas some suppliers opt to sit on their stocks in the hope of higherprices to come.

Oneof two guest speakers at the Non-Ferrous Metals Round-Table inDüsseldorf, Christian Schirmeister of RBS Sempra Metals suggestedthe world economic/financial crisis still has some considerabledistance to run by quoting British statesman Winston Churchill: “Nowthis is not the end. It is not even the beginning of the end. But itis, perhaps, the end of the beginning.” And he joined withnaturalist Charles Darwin in arguing that “it is not the strongestof the species that survives … not the most intelligent … but themost responsive to change.”

TheChairman of the LME’s Copper Committee contended that, over recentyears, the influence of the financial community has increasinglydistanced the metal markets from the fundamentals of supply anddemand. Prices have collapsed because of a need to liquidate amongpeople who have “never seen a cathode”, he told delegates.

Thedivision’s other guest speaker, Paul Thomes of Aachen University’sFaculty of Business and Economics in Germany, suggested that thecurrent economic crisis emphasises the need to aim for a fairallocation of resources and for more social responsibility which hedubbed “responsible capitalism”. He called for “a certain levelof systemic control” of economic players while leaving “space forcreative entrepreneurial action”.

ends