Small price rises in Italian rebar market; wire rod stable despite higher mill offers
Mills increased their rebar and wire rod offer prices, but the higher wire rod prices have yet to be accepted, Fastmarkets understands – although mill sources said they were optimistic the higher levels will be implemented before Christmas closures.
In Spain, meanwhile, rebar prices remained unchanged, with market participants holding out against any higher offers.
Fastmarkets price assessment for steel reinforcing bar (rebar) domestic, exw Italy was €570-600 ($591-612) per tonne on Wednesday up by €10-20 per tonne from €560-580 per tonne week-on-week.
The minimum level in Italy was up by €10 per tonne week on week, source said.
“The prices have increased so far this week and are still [rising],” a buyer source told Fastmarkets. “But some producers stopped production due to the high cost of electricity and scrap [and] we are closer to the Christmas holidays and, in a few days, mills will [start to] close until January.”
A second trader source said that demand was good last week and had not been so bad so far this week.
“The rebar price is now at €580-590 per tonne, but customers are still receiving material ordered last week at €560-570 per tonne,” the second trader source said.
“Maybe producers will increase prices again before the Christmas closures,” the second trader source added.
International scrap prices, meanwhile, have remained steady compared with last week, although they are down month on month because of slow steel sales, sources told Fastmarkets.
Fastmarkets’ calculation of its daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was $333.00 per tonne on Wednesday, down from $336.95 per tonne a week earlier and from $361.37 per tonne in the first week of November.
Elsewhere in Southern Europe, Fastmarkets’ price assessment for steel reinforcing bar (rebar), domestic, delivered, Spain was €580-600 per tonne on Wednesday unchanged week on week.
“The Spanish market has not changed, but we hear that German mills have increased their offer prices. Once the new levels are accepted in Northern Europe or Italy, the Spanish producers will [also] increase [their offers],” a producer source told Fastmarkets.
Southern European wire rod
Fastmarkets’ price assessment for steel wire rod (mesh quality), domestic, delivered Southern Europe, was €600-610 per tonne on Wednesday, stable week on week.
Mills increased offers by €10-20 per tonne in Southern Europe, but workable prices remained stable at €600-610 per tonne, sources told Fastmarkets.
“Mills want to increase prices but, so far, I am seeing a rolling over of November prices” a trader source told Fastmarkets. “We shall see if such increases will be achieved and, if yes, how long it will last.”
A second trader source said: “There have been pushes for increases, but no actual deals yet,” a second trader source told Fastmarkets.
And a wire rod producer source said there were reasons to be optimistic.
“We are facing a weak market, but we are seeing a willingness among customers to accept small price rises compared with November. This is probably because December is a period when it is more difficult to source supplies compared with other times of year when supplies are more abundant. So if the market continues to show positive signs, we will implement further price rises,” the source said.
Spot market for European green flat steel still in limbo; distributors look to long term
Willingness to pay premiums for steel with reduced carbon emissions content was still limited among European buyers, however.
There was a lack of projects across Europe requiring green steel, market participants said, and demand from the key consumer – the automotive industry – has recently been slowing in line with the general downturn in the European economy.
“We can’t reverse the green steel transition,” a distributor in Germany said. “The market is moving in that direction and the demand will come – it’s just a matter of time. But in a recession, sustainability becomes a secondary problem for buyers.”
A buyer once again pointed to a lack of clarity and standards for green steel in Europe, which was slowing its uptake across supply chains.
Fastmarkets’ methodology defines European green steel as “steel produced with Scope 1, 2 & 3 emissions at a maximum of 0.8 tonne of CO2 per tonne of steel.”
And Fastmarkets’ weekly assessment of the green steel domestic, flat-rolled, differential to HRC index, exw Northern Europe, was €80-200 ($84-210) per tonne on December 5, stable week on week.
During the assessment week, leading European suppliers kept the premiums for such steel at €200-350 per tonne.
Buyer sources estimated the achievable premiums for green steel with that level of emissions at €50-150 per tonne, although the lower end of that range was not considered workable by mill sources.
Bids were reported at €80 per tonne during the week for steel that was carbon neutral for Scope 1 & 2 emissions. But a market source said that such bids were rejected by the seller.
One mill source estimated achievable values at €100-200 per tonne for steel produced with Scope 1, 2 & 3 emissions at a maximum of 0.8 tonne CO2 per tonne of steel.
Wider market
The European market was taken aback by recent news of ArcelorMittal’s announcement that it would postpone a final decision on several investments in direct-reduced iron (DRI) modules across Europe due to challenging market fundamentals.
Meanwhile, despite the challenging times, some buyers continued to invest in green steel and raw materials purchases, expecting demand for steel with reduced carbon emissions content to rise exponentially in the years to come.
GreenIron-Scandinavian Steel
Scandinavian Steel, a leading distributor of metals in the Nordic region, and GreenIron, a Swedish green iron startup, signed a collaboration agreement on December 2.
Under this agreement, Scandinavian Steel will become the exclusive distributor of GreenIron’s fossil-fuel-free iron, which is to be produced in Sandviken, Sweden.
“The agreement covers a regular delivery of hydrogen [produced] DRI, which will be offered to the Nordic and European markets,” a press release read.
GreenIron was expected to begin commercial production of green DRI in Sandviken in 2025. The DRI plant there will have capacity for 28,000 tonnes per year and will use hydrogen as a reducing agent.
Blastr-Interfer
On November 28, Nordic green steel startup Blastr and German steel trader Intefer Edelstahl Group signed an offtake agreement for supply of 150,000 tonnes per year of ultra-low carbon emission steel products.
Deliveries were expected to commence in late 2029, Blastr said in a press release at the time.
Blastr expected to produce hot-rolled coil-grade steel with carbon emissions of less than 500 kg of CO2 per tonne of steel, including Scope 1, 2 and 3.
Blastr and Interfer will start discussions on a binding agreement early in 2025.
Established in 2021 with the aim of becoming an integrated low-CO2 steel producer, Blastr planned to produce around 2.5 million tpy of hot- and cold-rolled steel.
Final investment decisions on both a DRI plant and a steel plant were expected by early 2026.
Worthington to acquire majority stake in Italy’s Sitem
Worthington Steel is acquiring a controlling interest in Italy’s Sitem SpA through subsidiary Tempel Steel Co, Kallanish learns.
In a statement, Worthington says it will own 52% of Sitem, a producer of automotive and industrial electric motor laminations and accessories.
Geoff Gilmore, Worthington Steel’s president and chief executive, explains that the Columbia, Ohio-based metals processor entered into the agreement to increase its exposure to the automotive market.
“This investment aligns with our strategic goal to grow our electrical steel lamination business and expand our customer reach. Sitem Group brings 50 years of experience and is one of the largest producers of electric motor laminations in Europe. The Worthington Steel and Sitem Group leadership teams bring valuable expertise and relationships to spearhead the expansion of our global automotive programs in the production of electric vehicles and hybrids,” states Gilmore.
“We are excited to partner with Worthington Steel,” adds Marco Bartoloni, ceo of Sitem Group. “This investment and partnership will enable us to better serve global automotive and industrial motor customers. Their philosophy aligns with our values and is a great fit for our employees.”
As the deal currently stands, Worthington is acquiring shares from Sitem Group’s existing shareholders and transaction is expected to close in early 2025, subject to the receipt of applicable regulatory approvals and customary closing conditions.
Latham & Watkins LLP served as legal counsel to Worthington Steel on the transaction. Sitem was advised by UniCredit as financial advisor, Antonello Marcucci as senior advisor and Bird & Bird as legal counsel.
Sitem Group operates six facilities across Europe: three in Italy, and one each in Switzerland, Slovakia and France.
Kristen DiLandro USA
