German rebar mills eye Polish sales, lose workers
While rebar sales in Germany continue to deteriorate along with the nation’s construction industry, activity is faring relatively better in Poland, which has become the more attractive market for some German sellers.
Rebar mills in eastern Germany, in particular, largely Italian-owned, are seeing better business in Poland than in their home market. “You get better prices there. I spoke to the management of Feralpi Stahl; they said it is the first time they are selling eastward to Poland,” one buyer tells Kallanish. Feralpi group makes no secret of that development in its official statements. While revenue generated in Italy and Germany dropped in 2023, “the trade performance of the Polish market improved significantly,” the group writes in its latest annual report.
On the German market, base prices from domestic mills over the summer have trended stably at below €360/tonne ($403), which plus the fixed size extra of €265 comes to a delivered price of €625/t – or less. Although some sources have observed recent increases in offer prices, of up to €650/t delivered, this has not been widely substantiated in transactions.
However, while the stronger Polish construction economy is bringing some benefit to eastern German mills, it is, on the whole, having a detrimental impact on the rebar business in Germany. This is because it is encouraging Polish immigrant workers in Germany to return home.
“For Polish workers, the road to Germany is barely paying off, with wages minimally higher, so they would rather look for work at home,” one manager at a German rebar bender says. A manager at Atterer in southern Germany concurs, and describes the issue in a letter to customers. “We keep losing workers for financial and family reasons, although they value us as an employer. And it is difficult to attract new qualified workers,” Atterer writes, describing the dilemma.
The company points out that the Polish zloty has jumped by 10% against the euro since last year. For Polish workers in Germany, this means their wages have 10% less purchasing power when they travel home. This, plus the high costs of living and fuel, make working in Germany unattractive for them.
German distributors’ sales fall slightly in first half
Germany’s stockholding distributors sold a combined 5.016 million tonnes of steel products in the first half of the year, around 100,000t less than in H1 2023.
The first two quarters did not differ much, with 2.469mt sold in Q1 and 2.448mt in Q2, Kallanish learns from distributors’ association Bundesverband Deutscher Stahlhandel (BDS).
The average sales volume per month was 816,000t. Split by product group, long products on average accounted for 250,000 t/month and flat products for 495,000t. Miscellaneous other products, such as wire rod, accounted for 71,000t.
In a comparison of the last months of the respective periods, June 2024 was virtually equal to June 2023, with both registering around 830,000t of sales. BDS provides no interpretation of whether this could mean that stockholders’ activity has now more or less synchronised with last year. In March, the difference was still more pronounced – 817,000t this year versus 994,000t in March 2023.
In terms of inventory tonnage, the monthly average was 1.964mt in Q1 and 1.948mt in Q2. Inventories of long products in the second quarter were 637,000t, flat products totalled 1.267mt, and miscellaneous products 44,000t.
Until the end of 2022, the monthly average inventory was above 2.18mt, with all months normally above the 2mt mark. Since early 2023, only three months, July 2023, February 2024 and April 2024 eclipsed that mark, by some 1,000t.