BOF-based producers are facing severe pressure due mainly to increasing raw material costs, with closures confirmed and threats of potential closures in several regions. The only solution may be to slow down and stop inefficient facilities, says the International Rebar Exporters and Producers Association (Irepas) in its monthly market report. 
 
Iron ore prices surged 18% in June on strong demand and supply disruptions. Some idling of blast furnace production will mean production shifting toward scrap-based electric arc furnaces, which are extending their order books. The BOF production cuts will help balance supply and demand. 
 
The increased competitiveness of EAF-based mills could continue further as the associaion believes that the recent uptick in scrap prices is not expected to be sustainable because fundamentals do not support higher levels. Pig iron prices have seen a downward adjustment to match low residual scrap, which has not made any real gains. Overall, in the market there is an excess supply of slab, while for billet supply and demand are balanced.