The Italian steel sector is going through a liquidity and payment crisis. Re-rollers, producers and distributors who spoke to Kallanish are receiving warnings from customers that they will have to postpone paying their outstanding invoices.
While some customers are asking to pay by instalment, others are unable to pay as they have not invoiced for a month now. All steel companies in Italy are shut down this week starting from 25 March until 3 April in compliance with the latest government decree of 22 March that also puts local industry in lockdown.
“This week the market is completely frozen,” a distributor says. “Prices are stable and we are all expecting big price increases following the restart […of trading activity], but the problem is that companies won’t have any money to buy.”
Credit insurance is also becoming an issue as banks are offering support to companies that are financially solid but not to smaller, more vulnerable ones. “This crisis will cause bankruptcy in the steel sector,” another source warns.
