North European Steel market may remain gloomy in H1 2015: MEPS

UNITED KINGDOM February 25 2015 9:34 AM

LONDON (Scrap Register): Business activity levels are stable in northern Europe, according to MEPS International.

In Denmark, the mills managed to achieve a small part of their proposed price increase for hot rolled coil, due to material being quite scarce. Elsewhere, selling figures were unchanged, month-on-month, in local currency terms.

Commodity plate transaction values are unchanged from January, in the majority of countries researched. Demand is slow. Low-priced material is being offered from suppliers in Russia and China as they try to establish new markets. Transaction values remain depressed in Norway. The outlook for the first half of 2015 is gloomy.

No significant upturn in demand for cold rolled coil is foreseen in the first half of 2015. Most suppliers in Scandinavia were unsuccessful in their attempts to increase selling figures. However, producers in Denmark secured a small price hike. Hot dipped galvanised steelmakers struggled to implement planned increases despite relatively steady demand.

Selling figures for drawing quality wire rod were unchanged in February. Activity in the construction sector is disappointing. Consequently, demand for mesh is subdued and is expected to remain so for the foreseeable future.

Order intake for structural sections is at a reasonable level. Rolling schedules are filling up. An uptick in transaction values was secured before the reduction in raw material expenditure had any effect.

Rebar prices have not changed, month-on-month, following subdued demand and a drop in scrap costs. An increase is unlikely in the short term. There are competitive offers, in the market, from producers in Russia and Belarus.

Merchant bar prices have bottomed out. A small increase has been accepted by buyers. The mills are likely to seek further advances in the near term.