UNITED KINGDOM July 09 2015 10:45 AM
LONDON (Scrap Register): The depressed oil price has resulted in lower plate demand from the offshore sector, in Western Europe. However, the weak euro has helped mills in the region to increase sales in export markets, said MEPS International.
According to MEPS, scarce stainless steel scrap is pushing up input costs and squeezing the producers’ profit margins. Demand is showing signs of improving and rolling capacity is being booked further in advance. Basis prices are steady in Germany and France. Demand has been subdued, in the latter country, in May and June. End-user activity is described as “quite reasonable”, in Italy. There is little imported material being offered.
Demand is patchy, in the United Kingdom, but overall sales volumes are stable. There is no sign of an upturn in consumption, as the summer holiday period approaches. Selling values are low and profit margins are narrow. There is fierce competition between suppliers. Sales activity has slowed, in Spain, during the last three months. Stockholders and service centres are purchasing only small amounts of material.
Stainless cold roil coil buyers in Germany and France have resisted basis hikes but the mills are seeking higher figures for September deliveries. With alloy surcharges set to decrease further, sellers are keen to offset some of this loss, at least. The EU antidumping action has reduced the volume of imported material, in Italy, but it has not boosted prices. The mills’ service centres are offering very competitively. As a result, distributors’ selling values are very low and their profit margins are small.
Demand is very weak, in the United Kingdom. Consequently, stainless cold rolled coil basis prices are unlikely to rise, in the near term. Producers are claiming a healthy order load but buyers report plenty of material available. Ex-mill basis figures are stable, in Spain. However, ex-stock prices are said to have slipped as sales volumes have decreased.
End-user demand for stainless steel bars is stronger in Spain than in most other Western European countries, although it varies between different products. Nevertheless, sellers’ profit margins are tight and transaction values continue to slide, driven by the downward trend in alloy surcharges. Demand for stainless bar products is very poor, in the United Kingdom. Order intake from the oil sector and machinery manufacturers has slowed.