Steel price trend diverges in the EU flat and long products market: MEPS

UNITED KINGDOM September 21 2016 4:39 PM

LONDON (Scrap Register): The price direction for European strip mill products reversed over the course of the summer, according to MEPS.

Minor downward corrections were noted in July. Upward momentum, which began in late August, is ongoing. Small, positive movements of €10/20 per tonne have already been noted. ArcelorMittal announced a rise of €40 per tonne for deliveries from November onwards. 

The premium was above the levels achieved in the third quarter. Many buyers anticipate that they may be forced to pay more in the future.

Overall consumption is largely unchanged but availability is tight due to lack of third country import opportunities. This resulted from planned and existing trade defence measures and higher prices demanded by many overseas suppliers. 

Thus, the order load on European steelmakers increased, leading to long delivery lead times. Moreover, processing problems at a number of production facilities caused short-term issues and some backlogs.

MEPS reports that European long product selling values weakened over the summer. Current demand is not sufficient to support a price rise in the short term. 

Customers are not restocking in the traditional autumn manner. Consequently, producers are unable to fill their rolling schedules. Discounting was noted as delivery lead times shortened.