Managing supply and demand
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Managing supply and demand

Martijn van de Poll, managing director at Reukema, discusses company’s focus on data to improve quality of red metal scrap and deepen relationships.

October 2, 2019

Martijn van de Poll, managing director at Netherlands-based Reukema, says the company isn’t seeing an oversupply of red metals in Europe as some U.S. buyers are experiencing. While Europe has “quite a number of well-established red metal smelters and refineries,” Poll says Reukema, an international trading company, also sells locally sourced red metal scrap to smelters in Korea, Indonesia, Japan, China, India and Russia and sees growing opportunity in Asia.

Recycling Today connected with Poll to get his perspective on the red metals market in Europe and learn about new developments at Reukema that keeps the company competitive in the global marketplace.

Recycling Today (RT): What has demand been like for red metals in Europe?

Martijn van de Poll (MP): We have seen weaker demand in Europe. Factories are full, but demand is weak on their side. 

We do not see an oversupply yet in Europe. LME has been decreasing in the first half 2019. Our suppliers are partially still keeping their stock, waiting for better price levels.

RT: Where are the strong end markets for red metals? Are there any potential new markets that Reukema is watching?

MP: Europe has quite a number of well-established red metal smelters and refineries; however, we know that demand in Europe varies during the years. We service smelters in Korea, Indonesia, Japan, China, India and Russia. We see new opportunities mainly in Asia, as China is tightening its import regulations.

RT: How has the red metals market changed over the years? How can companies respond to lower pricing and weaker demand?

MP: Focus is very much on quality. Margins are slim. We can’t afford to deliver bad quality material. This will only become more important in the future. Reukema is continuously investing in technologies to better assess the quality of the material it purchases and sells. We are looking at ways to improve the quality in such a way that it meets the requirements of a specific smelter.

We have the advantage to work on a long-term basis with most of the big smelters; therefore, we are managing supply and demand. If Europe is weak, we still service smelters in Asia or other parts of the world having demand.

Reukema wants to be the prime partner of the top smelters worldwide for sourcing its scrap metal. We aim to control the quality of the scrap 100 percent and to process the scrap where needed in order to bring it within the requirements of the specific smelter.

In the future, focus will be on quality of the scrap and more focus on the local market in Europe for Reukema.

RT: What is the Reukema’s key to success to growing and improving business and making a profit in a changing marketplace?

MP: Our focus is on simplicity. That is not easy. We want to be the most predictable player in the industry. We have a strong focus on digitization. The customer journey with our suppliers and buyers is 100 percent digital, and completely transparent. We work with technology partners and universities to realize our goal to be able to assess the quality with 100 percent accuracy for each delivery of scrap metal. We also aim to sort material in order to make the scrap as per the quality requirements of the smelters.

RT: What is ReukemaDirect and how has developing that tool improved international trading for Reukema?

MP: ReukemaDirect is an e-commerce platform, where the complete customer journey is captured: real-time price and product information per supplier, logistics, quality assessment and quantity and quality reports.

ReukemaDirect is a great success. All our suppliers and buyers are using it. It is not so much focused on the deal itself. Many trades are still taking place over the phone or face-to-face via WhatsApp.

ReukemaDirect has helped us to improve our customer experience by providing real-time and transparent information, improve efficiency, reduce operational risk, improve the ecological footprint (100 percent digital, no more paperwork), as well as improving traceability and compliance. Equally important is that we collect data, which enables us to improve our customer service and retention daily.

We have been developing ReukemaDirect completely in-house. Recently, we have taken steps to make it a standalone company with standalone management. The company’s name is TradeDirect. The software will be made available to other companies. Reukema will step back as a sole shareholder, but we will keep using ReukemaDirect as our own dedicated platform. TradeDirect will be launched by early 2020.