Derichebourg sales rise in 'turbulent environment'

French metals recycler Derichebourg boosted ferrous scrap shipments in its most recent fiscal year even as global trade tensions weighed on demand.

"Political tensions between the US and Turkey, which resulted in a tense trading position, led to a reduction in Turkish purchases and consequently downward pressure, although in all likelihood, temporary, on ferrous metal prices," the Paris-based company said this week in a sales update.

Derichebourg ships to Turkey from France as well as its export yard on the US Gulf coast. Demand for scrap from the continental European steelmakers that Derichebourg feeds is also broadly impacted by Turkey.

Derichebourg lifted ferrous shipments by 2pc to 3.7mn t in the 12 months ended 30 September.

Ferrous selling prices rose by 12pc on average from the same prior-year period, but ticked down at year-end amid trade tensions.

Non-ferrous shipments dropped by 0.7pc to 540,700t for the year. Volumes recovered from a 3.4pc drop in the company's first half to increase by 2pc in the second half despite China's tightening of its import quality standards that primarily impacted aluminum and copper demand.

Non-ferrous selling prices rose by 4pc from a year earlier as higher exchange values year-over-year offset the weight on global prices of a glut of US aluminum scrap displaced by China's enhanced standards and US-China trade tensions.

Derichebourg expects the impact of global trade tensions to weigh on its profit on the year even as stronger ferrous demand and increased sales in its environmental and waste management division helped lift revenue across the group to €2.9bn ($3.3bn) from €2.7bn. Still, the impact will be limited as a result of its low inventory strategy, the company said.

Derichebourg will release its full financial results on 4 December.