Italian HRC Steel prices recover in August: MEPS

ITALY September 24 2014 5:32 PM 
ROME (Scrap Register): There are competitive offers, for hot rolled coil, from Russian suppliers in the Italian market. Domestic basis numbers fell to €400 per tonne in mid-July but have revived since then, said MEPS International in a research note.

According to MEPS, hot rolled plate rerollers are attempting to lift basis values by €30/50 per tonne as their slab supplies have been curtailed, with a consequent increase in costs. However, freight rates to Germany, their target market, are sufficiently high to make their offers uncompetitive in that country. Domestic demand is stagnant. Nevertheless, MEPS has noted a €20 per tonne advance during recent negotiations.

The auto sector shows no real signs of improvement. The purchase of consumer goods is low due to the deflationary nature of the economy. Despite poor demand and fierce internal competition, buyers of coated coil have agreed to a very small advance, said MEPS.

Low carbon wire rod prices are static. A poorly performing construction sector continues to create lacklustre demand for recoil. Steelmakers have kept effective figures steady, after offering a small discount in July to try to stimulate sales.

Effective structural section prices continue to suffer from the state of the ailing building sector. Despite more expensive scrap, suppliers have been unable to persuade customers to pay more for steel products. Recent forecasts for investment in construction are quite pessimistic

Sales of rebar are at a very low level. The recent increase in September is likely to be short-lived. Merchant bar basis figures continue on a downward trajectory, falling below the €100 per tonne level. The outlook remains bleak due to a lack of building activity, MEPS concluded.