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Balli Steel Expands Further Into Asian Steel Markets With The Appointment Of Gianpiero Repole

Balli Steel, one of the world’s largest privately owned independent commodity traders, has furthered its expansion plans into the Asian steel market with the appointment of Mr Gianpiero Repole as Business Development Director. Gianpiero joins Balli Steel from Noble Commodities where he held the position of Executive Vice President of Steel in Hong Kong.

Gianpiero’s appointment is part of a strategic move by Balli Steel to strengthen its operations in the increasingly significant Asian steel market with a specific focus on China which now accounts for approximately 50% of both world steel production and global consumption.

Gianpiero has pan-Asian experience of the steel market and an extensive network of contacts which spans the region. He will spend a considerable amount of time travelling across the company’s network of offices and will be constantly promoting the business in both established and new markets. Gianpiero will also focus on increasing Balli Steel’s share of the flatroll trading market and looking at ways of maximizing revenue across the company’s Asian operations.

Vahid Alaghband, Chairman of Balli Group, commented: “We are very pleased that Gianpiero has joined Balli Steel as his experience and contacts will be invaluable to us as we look to expand our trading operations across the Asian markets. We see a number of strong opportunities for Balli Steel in the region over the next 18 months and believe that we are now well positioned to capitalise on these prospects.”

Gianpiero Repole commented: “My new role at Balli Steel is an exciting challenge, which brings with it countless opportunities to promote the company’s operations across Asia. My appointment coincides with a considerable strengthening in the Chinese steel market as both production and consumption levels continue to rise.”

Figures from the World Steel Association show that crude steel production in China increased by 5.4% year-on-year in August 2009, whilst global production declined by 18.1% over the same period.

Balli Steel estimates that Chinese steel production already stands at over 400 million tonnes in the first seven months of this year compared with 560 million tonnes during the whole of 2008 and only 200 million tonnes as recently as 2000. Increased supply has enabled China to become one of the leading exporters of steel, joining the ranks of the EU and Japan, with exports exceeding 20 million tonnes.

Nasser Alaghband, Director of Balli Steel commented: “The fortunes of the Asian and GCC steel markets have reversed over the past 20 years. In the 1990s and early 2000s the Middle East steel market was booming, however, now it is the Asian markets, led by China that has a dominant global position, whilst the Middle East markets remain subdued. We expect this trend to continue as the Chinese and Indian economies expand and we have already identified a number of key opportunities for Balli Steel across the region.”

Via EPR Network
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Balli Steel Warns Russian Steel Market Continuing To Face Challenging Conditions

Balli Steel, one of the world’s largest privately owned independent commodity traders, has warned that despite the bottoming out of the global steel market, the Russian market will continue to face challenging conditions for the next 12 to 18 months. Speaking at Metal Bulletin’s 7th Russian Steel Summit in Moscow, Nasser Alaghband, Director of Balli Steel, outlined that the strengthening Rouble and the impact of the annual Iron Ore negotiations could weaken the competitiveness of Russian producers.

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According to Balli Steel, the Russian Steel market has undergone considerable growth and wide scale transformation over the past decade with gradual modernisation of plants and production facilities. Russia is able to take advantage of abundant natural resources and competitive labour costs to produce steel on the lower side of the cost curve and has established a strong position as the 4th largest producer of steel in the world.

Balli Steel highlighted that the downturn in global steel prices has not been easy for the majority of Russian producers to absorb, with many in the midst of extensive capital investment initiatives on plant modernisations and new acquisitions.

Steel consumption appears to be down by 40% year-on-year, with Russia’s largest steel company, Severstal, expecting domestic demand to fall by 25% in 2009. Balli Steel anticipates that domestic demand will remain low as the country heads towards its first recession for 10 years.

However until very recently the decline in domestic steel demand was offset by export growth, with the weak Rouble, which had declined by as much as 36% against the Dollar in the previous year, making Russian Steel an attractive proposition to importers. However, in the last month, the Rouble has undergone a substantial appreciation which has put considerable pressure on the export prices. The profit margins for many of the Russian Mills have begun to shrink, with most producers now operating at close to cost. As a result, any further strengthening of the Rouble would put increasing pressure on Russian steel exports.

Nasser Alaghband, Director of Balli Steel commented: “Global steel prices have shown signs of recovery in recent months. However, whilst price improvements have been promising, steel has not recovered as well as some precious metals or energy commodities. We believe that steel prices will increase further amidst the global economic revival, although the recovery will not be smooth or uniform and individual markets, such as Russia, will continue to react differently to both domestic and international factors.”

About Balli:
Balli Steel is part of Balli Holdings, is a large private, multi-national corporation, chaired by Vahid Alaghband. The company is headquartered in London, but has offices in Dubai and other key business hubs around the world.

Balli was established in 1982 and operates a number of affiliated companies specialising in commodity trading, industrial, real estate and private equity with operations in over 20 countries. Together with its affiliated companies, Balli employs over 2,000 people worldwide.

Balli Steel is the company’s principal operating subsidiary, and is one of the largest independent traders of steel in the world. Balli Steel provides raw materials and steel to a number of market segments including steel mills, steel service centres, pipe and tube makers, the oil and gas industry and other designated end-user segments such as the packaging products industry.

The company’s real estate operations currently have are invested in a significant property portfolio comprised of over 900,000 sq ft of property under development with a Gross Development Value of some $800 million, and an additional 2 million sq ft and a GDV of almost $2.5 billion in the pipeline.

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Balli Steel Reports Enhanced Role For Steel In Construction Industry Despite Slowdown

Balli Steel, a leading international steel trader, has reported that despite the slowdown in the global economy, the role of steel in construction industry markets across the world will grow. Balli Steel highlight that this growth is due to a range of factors including environmental and recycling benefits, urbanisation, technological advances and the load bearing, high rise opportunities, safety and speed of construction benefits that steel provides.

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Company forecasts indicate that global annualised steel production this year is to be 1.1 billion tonnes, with the construction industry being the largest end-user of steel, accounting for over 40% of total steel consumption.

Balli Steel calculate that the competitive cost gap between steel and concrete building frames is widening. A recent report by the British Constructional Steel Association (Q4 2008) showed a £22.22 per sqm advantage for steel frames over concrete, up from £12.10 per sqm in 1995.

Another advantage is that whilst steel has a higher embodied carbon value per tonne than concrete, a tonne of steel goes a lot further so steel structures generally have a lower carbon footprint than concrete ones.

Vahid Alaghband, Group Chairman of Balli Steel, said: “Whilst many people may often equate steel buildings and infrastructure schemes with super-high rise and large span structures, steel is also used extensively in small scale and low rise buildings. Steel is used throughout the construction industry and the building process, not just on mega projects.”

Balli Steel points to the global process of urbanisation as another factor driving the demand for new buildings, and therefore a demand for construction steel. The United Nation’s (UN) latest figures show that 50% of the world’s population live in urban areas. Over 3.2 billion people now live in cities, up from 732 million in 1950. The UN calculates that by 2050, over 6 billion people, 75% of humanity, will be living in towns and cities.

In the current ecologically aware times, steel is often favoured over other materials like wood and plastic. Nasser Alaghband, Managing Director of Balli steel commented: “The advantages of steel in the building construction process include strength, energy efficiency, design flexibility, fire resistance, speed of assembly, material cost advantage and less maintenance. The steel industry has been actively recycling for more than 150 years and it is becoming increasingly financially and environmentally advantageous to continue with this approach. It is cheaper to recycle steel than to mine iron ore and manipulate it through the production process to form new steel.”

Over 95% of structural steel beams and plates, used in building manufacture, are recycled, and similarly, other construction industry elements such as reinforced bars are recycled at a rate of around 65%. Balli highlight that the energy saved by recycling these large amounts of steel globally is enough to power 18 million homes around the world for one year.

About Balli Holdings
Balli Holdings, is a large private, multi-national corporation, headquartered in London, but with offices in Dubai and other key business hubs around the world. Balli was established in 1982 and operates a number of affiliated companies specialising in commodity trading, industrial, real estate and private equity with operations in over 20 countries. Together with its affiliated companies, Balli employ over 2,000 people worldwide.

Balli Steel is the company’s principal operating subsidiary, and is one of the largest independent steel trading companies in the world. Balli Steel provides raw materials and steel to a number of market segments including steel mills, steel service centres, pipe and tube makers, the oil and gas industry and other designated end user segments such as the packaging products industry.

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Balli Steel, One Of The World’s Largest Privately Owned Independent Commodity Traders, Forecasts Economic Recovery In Five Phases

Balli Steel, one of the world’s largest privately owned independent commodity traders, has forecast that the global economic recovery will sequentially occur in five phases, with increased demand for steel in each sector acting as a barometer or indicator of such recovery.

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Balli Steel highlights that global annualised steel production this year is forecast to be 1.1 billion tonnes, down on last year’s record 1.3 billion tonnes, but significantly higher than the 800 million tonnes recorded in 2000.

Balli considers the steel markets of North America, Europe and the Gulf Co-operation Countries (GCC) the hardest hit by, not only the credit crisis, but by overstocking and speculation on future prices. Balli expects the market in the GCC economies to see a gradual improvement while North America and Europe will experience continued problems. Forecasts indicate that Japan and South Korea will also continue to face economic challenges since their industries are more dependent on Western Europe and North America.

Vahid Alaghband, Group Chairman of Balli Steel, said: “The credit crunch and global economic downturn has had a ‘Tsunami Effect’ covering all key economic sectors: steel and other commodities, property, automotive, capital goods and finance. At present steel producers are operating only at around 50-60% of their capacity. We consider the implementation of government driven stimulus packages, which will see significant public sector investment in civil engineering and infrastructure projects, will procure the first phase of the global economic recovery.”

Balli Steel considers that the second phase will be characterised by a gradual recovery of the housing market that is expected to begin in Q4 2009, and which will be led by key cities such as London, New York, Singapore and Hong Kong.

Vahid Alaghband observed: “With prices down by up to 40% in certain markets, overnight interest rates at the near zero level, and yields at up to 10%, property has become a good long term investment again. With supply at a record low we expect the market to grow steadily through to beginning 2010 and well into 2014. The return to the market of competitive mortgages will prove a further boost.”

Phase three of the recovery will be characterised by increased demand for products that rely on unsecured loans and consumer-credit. Balli Steel calculates that the retail, white goods and automotive industry will begin to see a return to recovery to begin around Q2 2010.

Balli also expects a recovery of the global shipbuilding industry, providing a major boost to steel traders, in the first quarter of 2011, marking the return to more normal international trading patterns and leading the fourth phase of the global recovery. The fifth phase will be a return to more normal investment in capital goods by producers as they gain confidence in the state of the world economy.

“We are by no means out of the woods yet and there is a lot of pain ahead of us in 2009 and 2010. But in the last few weeks as I speak to business counterparts the general consensus appears to be that we are no longer in a state of uncontrolled free-fall and we are at or close to the bottom in a number of markets”, said Vahid Alaghband.

About Balli:
Balli Holdings, is a large private, multi-national corporation, headquartered in London, but with offices in Dubai and other key business hubs around the world. Balli was established in 1982 and operates a number of affiliated companies specialising in commodity trading, industrial, real estate and private equity with operations in over 20 countries. Together with its affiliated companies, Balli employs over 2,000 people worldwide.

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International Steel Returns To Normal Trading Levels Reports Balli Group

Balli Group Chairman, Vahid Alaghband, reports international steel market bottoms out and returns to normal trading levels.

Vahid Alaghband, Group Chairman of Balli Group, one of the world’s largest privately owned independent commodity traders, has stated that he believes the indications are that the international steel market has now bottomed out and is once again experiencing a normal trading environment, albeit at reduced volumes.

The return to regular steel trading confirms that the market has now recovered from the state of paralysis it found itself in last year.

Vahid Alaghband commented: “The international steel trading market is no longer frozen and we expect further stabilisation over the next 6-12 months. The return of normal trading and the relative stability of prices is an important milestone in the recovery of the construction industry and for the global economy.”

Nasser Alaghband, director at Balli Steel, added: “The bottoming out of the market for steel follows a cut in capacity by producers in response to the global downturn in construction and the seasonal fall in demand for the northern hemisphere. The growth of the steel futures markets for construction steel in London and Dubai since 2007 has helped increase price transparency and has enabled decision making on capital investment.”

Major steel consumers – property developers, construction firms and ship builders – welcomed the growth of the futures market for steel as it provides them with a means of controlling risk by enabling users and suppliers to lock in prices and avoid losses.

Balli Steel experienced good trading levels in Q4 (2008) and expects Q1 to be slower, partially due to seasonal variations in the market. Near normal market conditions are predicted for the second half of the year.

Nasser Alaghband observed: “The market became incredibly difficult and almost non-existent early in 2008 as demand, principally from the construction industry evaporated in response to the global financial crisis. The situation eased during the third quarter and by Q4 the market began to trade again in a normal fashion.”

“One major obstacle to European trade is the loss of access to credit insurance as insurers such as Euler Hermes and Atradius re-evaluate their exposures in deteriorating economic conditions”, Nasser concluded.

About Balli Group plc

Balli Holdings, is a large private, multi-national corporation, headquartered in London, but with offices in Dubai and other key business hubs around the world.

Balli was established in 1982 and operates a number of affiliated companies specialising in commodity trading, industrial, real estate and private equity with operations in over 20 countries. Together with its affiliated companies, Balli employ over 2,000 people worldwide.

Balli Steel is the company’s principal operating subsidiary, and is one of the largest independent traders of steel in the world. Balli Steel provides raw materials and steel to a number of market segments including steel mills, steel service centres, pipe and tube makers, the oil and gas industry and other designated end user segments such as the packaging products industry.

The company’s real estate operations currently have a property portfolio of over $3billion, comprised of over 900,000 sq ft of property under development with a Gross Development Value of some $800million, and an additional 2million sq ft and a GDV of almost $2.5billion in the pipeline.

Via EPR Network
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