ŽP EKO QELET a.s., as a member of ŽP Group, is ranked among the strongest Slovak companies which are engaged in a collection, purchase and processing of steel scrap and non-ferrous metals. The company is a key supplier of steel scrap for its parent company Železiarne Podbrezová a.s., that manufactures steel by means of steel waste recovery in an electric arc furnace. The main advantage of the recycling process is a higher energy effectiveness and lower CO2 emissions compared with a standard production of steel processing the ore in blast furnaces and converters.
Last year the company ŽP EKO QELET a.s., had to face a difficult market situation. Despite the gradual degression of the last year, the end of the year brought positive results. We have evaluated the last 12 months with Mr. Roman Veverka, General Manager of ŽP EKO QELET a.s.
In 2023 the industry faced several obstacles. What was the year like from the point of view of the company ŽP EKO QELET a.s.?
– It has become a standard that the balanced periods obtain such attributes as „demanding, unsearchable, unpredictable or turbulent“, not excluding the last year. We started far better than expected. From the point of view of purchase and sales, the first months results were more than satisfactory. Despite the fact we were registering growing signals of the economies slowing down and the resulting consequences for most of the industry branches.
When was the situation changed?
– The situation was changed during the second quarter of the year and the degression was fully manifested in summer months. Thanks to the measures taken in order to rearrange the company’s customer portfolio and thanks to a maintenance of positive trend of the non-ferrous metals business we were able to close the year with positive results. In a relatively short period of time it was necessary to respond quickly to the decreased demand for our products and the related sales failure, to find sufficient and reliable new sales areas, to enhance the activities which were not supporting ones before and thereby to diversify a risk of possible losses.
Was there enough steel scrap at the market?
– Until recently it was held valid, that there is a sufficiency of scrap at the market if it is well-evaluated by the market. In other words, if its price is high. Industrial metal semi-finished products are more and more optimalized to obtain smaller and thinner sizes, or they are replaced by non-metallic materials and it results in smaller volumes of metallic production waste. There is a significant decrease in the scrap quantity coming from demolish and disposal operations. The quantity of old buildings and technologies is incomparably smaller than it used to be tens years ago. They were replaced by more advanced ones, which still perform their tasks. And in case they have to be liquidated, the metallic waste outputs are smaller. An old important source, so called „folk purchase“, has already overcome its haymaking. Thrown out waste, including the metallic one, was significantly cleared from our environment in towns, villages and their rural areas. The way of living in the countryside was markedly changed – there are no longer numerous items of agricultural and transport machinery at private yard as it used to be in the past. Municipal and country self-supporting workshops, full of metallic material and tools and focusing on repairs of anything, nearly disappeared.
If taking into account also the economy cooling with related attendant phenomena, the quicker dry-up of the metal scrap sources is natural, the competitors’ contest for each ton is more and more intense.
It is difficult to predict the situation development. Nevertheless, do you expect the year 2024 will be better than the previous one?
Following the available information, no improvement can be expected. We must be realistic and try to gain an optimal profit from the actual status of the market. I am not able to tell responsibly whether it will be sufficient for a satisfactory end of the year. But for sure, we will not be just passively waiting for the steps and decisions of our environment. We can rely on our experience as well as on cleverness, abilities and skills of our employees that are basic and determining prerequisite to handle most of problems. That’s why I believe we needn’t see our future with any excessive worries – more to the contrary, with a certain dose of discretion supported by healthy optimism. It will be important to keep a sober judgement when taking decisions and not to give way to a flood of ballast or misleading information. As well, let’s not look for ill-wisher and enemies round each corner. We are those who is a creator of our results, positive or negative ones.
Article written by: Podbrezovan
