EU coil buyers approach Blechexpo with mixed feelings

This week’s Blechexpo trade fair in Stuttgart, Germany, is traditionally an occasion during which contracts are agreed for coil supply for the coming years.

The market leader mill has signalled that its prices for the next half-year will be close to €200/tonne ($233) above those fetched during the last negotiating round in May, says a buyer of a German cold-roller company. He adds he is not yet sure if he will be striking a deal at the fair, as he believes that the downtrend on the spot market is continuing. He is convinced that “there will still be offers coming after the fair”.

The coming days will show to what extent current spot prices will be a guideline, and where they actually are. Some observers foresee a price resurgence or stabilisation, like a buyer of a southern German distributor who tells Kallanish of rising prices from Russia, which would have repercussions on EU players.

In fact, he finds that buyers have done well if they have struck a contract prior to the fair. This is quite contrary to the attitude of waiting-and-seeing that has prevailed among buyers since the summer, while mills kept pushing. “If you haven’t signed yet, you may pay €20-30 more for your deal at the Blechexpo than a couple of weeks earlier,” he believes.

Even if the higher import offers turn out to be temporary, some insiders believe, for other reasons, that there will be a stabilisation in the coming weeks, a Dutch manager says. “We expect that consumers and other buyers will soon have to go back into the market to replenish their stocks. This will improve demand at least to some extent,” he comments.

Christian Koehl Germany