From the perspective of Austrian observers, rebar offer prices fell dramatically further last week, more than in Germany, and in line with Italy. But there are signs of a stabilisation going forward.
With a view to Italy, one Austrian source tells of offered base prices at “little more than €300/tonne [$323] ex-works,” reported just before Italy’s public holiday on Friday. Domestic mills have been quick with catching up, with an offer sent on 1 June of €345 delivered. “This includes transport costs of easily €30 to our door,” which means the ex-works base price is relatively in line with Italian quotes.
German suppliers, too, will have to adjust their offers to account for the Italian influence, as the German home market is weakening as well. “We are negotiating with a German mill today, and they are just below €400 now,” one buyer tells Kallanish. He believes offers within Germany are still above that mark, which would nevertheless still mean a drop from the €450+ reported a week earlier.
Meanwhile, border-crossing offers from Italy to Germany will now be at under €400/t delivered, and could be a serious alternative for buyers in southern Germany, up to Hesse and Thuringia. To obtain effective prices, the conventional size extra of €265/t needs to be added to the above values.
Sources have heard of plans for closures or output reduction at Italian mills, which has also been reported from Germany. Moreover, summer vacation time is closing in, and maintenance breaks this year could come sooner and last longer. This would coincide with some improvement in Austrian construction activity, and possibly create a shortage which would stabilise prices, one source says.
Christian Koehl Germany