Players on the northwestern European sections market find the latest price hike announcement from the market leader to be fair and believe that it will take root in the market.
The announcement, intended to cover a variety of long products, will mean less of a resurge but rather a stabilisation after shaky pricing over the summer.
Prices in some cases have softened to €800/tonne ($930/t) for Category 1, S235 sections delivered. The €20/t target should bring the level back to €820/t where it was previous, which observers say is “absolutely realistic”.
In July, the market leader had tried for a bigger hike of €40-45/t, but in vain. “So now they are trying more moderately and will be satisfied if it works. That’s often their approach,” one observer tells Kallanish.
Some players are now preparing for prices to head towards €840/t, others say the mills will be happy if they can secure €820/t across the board. One mill manager points at the continuously high power costs in EAF production, which he says, “will not get better going forward”. And he is sure that scrap prices will resurge following the drop in the last two months.
The price will differ slightly by region, he says. And he warns that southern European mills could intervene with lower offers. “They are a factor that’s prone to disturb the prices every now and then,” he says.
