The Italian scrap price downtrend has come to an end, as sentiment has radically changed compared to last month, Italian steel trade association Assofermet says in its market note monitored by Kallanish.
“Some behaviours are being noted in the market, such as an increasingly marked verticalisation, the total control of scrap collection and, lastly, some steel mills have purchased scrap demanding delivery in the month following the date of purchase agreement, storing material at their suppliers,” the note says. The main concern is material availability in case scrap demand from mills increases. “Therefore, we are looking very carefully at steelmakers’ production plans,” the association adds.
October was a month of low scrap purchases and price stability. Demand was different for each Italian region and mill depending on production schedule. Demand and supply were mostly in line, which caused prices to remain mostly stable. However, in October, scrap availability showed a steep decline. The general negative sentiment in October pushed most merchants to sell as much as they could.
Meanwhile, the association points out the persisting spread between pig iron quotes in the European and US markets, with the latter mostly supplied by Brazil. Material availability at Italian ports is at good levels and, thanks to the improving sentiment, a demand recovery and price hikes may take place this month. At an international level, Assofermet is registering a slight, $10/t pig iron price increase in Turkey but a $10-15/t decline in Asian markets.
The association noted low demand for ferroalloys last month due to the several production stoppages across Europe. Steelmakers are however asking for quotes and material for first-quarter-2024 delivery. In October, ferroalloys prices see-sawed but declined moderately, Assofermet concludes.
Natalia Capra France