EU first-quarter distribution stocks recede after record high

Stock levels at steel distributors across Europe ended the first quarter by correcting significantly after reaching a record high in December 2022, according to the latest data issued by EUROMETAL, the European distributors association.

The stock level index published by the association for the EU27 indicates that by the end of March, stock levels of all steel products at distributors were at 67 days of sales, the lowest level since March 2022 when they reached 62 days, Kallanish notes. In December 2022, the index spiked to 118 days of sales. On average in 2022, distributors had some 82 days of sales monthly in their stocks, a record level compared with 70-78 registered during 2018-2021.

Steel service centres specialising in selling flat products also closed Q1 with stocks at 63 days on average in the EU27 and UK, below the March 2022 level of 64 days and almost half compared with December 2022 at 124 days.

The lower stock levels could be seen as a positive indicator for apparent steel demand in Europe but, at the same time, shipments from distributors across Europe remained in Q1 at significantly below those registered in Q1 2022 (on average -7.9% year-on-year for all steels).

Emanuele Norsa Italy

EUROMETAL Comment: December shipments of steel stockists and SSC are seasonally low and that this induces a fatal rise of stocks expressed in days of sales in the EUROMETAL December data.