Amid strong demand and limited supply, European domestic steel sections prices increased significantly in the week up to May 19, market sources told S&P Global Platts.
S&P Global Platts’ European medium sections price (category 1, S235 JR) was assessed at Eur880/mt delivered May 19, up Eur70/mt week on week.
One distributor based in the Benelux region told Platts that prices have been increasing on almost a daily basis for the last two weeks, and it is getting difficult to explain the rise to customers.
The source said it was a combination of higher demand along with supply limitations and scrap prices. As demand increases, mills start buying scrap, so scrap prices go up. And seeing the trend in prices, customers start buying more. So, people perceive that there is huge demand, “but that is not the case, actually,” he told Platts.
The source put mill offers at Eur880/mt delivered, adding that mills refuse to accept any price below this level these days. He also reported a deal for 3,500 mt booked week ending May 16 at Eur820/mt (S235 JR, Cat 1) delivered Benelux, before prices went up. The source expects mill offers to start from Eur900/mt delivered next week.
One European mill source reiterated a mill offer at Eur880/mt delivered, noting deals at the same level as well, adding that German mills were already offering at Eur900/mt delivered. He expected the overall market to reach these levels in the near term.
“Price is moving up really fast because order books are good. Customers need the material, and availability is very narrow,” he told Platts. The source noted that scrap prices are significantly increasing, too, and said they were expected to continue rising in June as well.
Scrap prices continued to increase in the international market. Platts assessed Turkish imports of premium heavy melting scrap 1/2 (80:20) May 19 at $506/mt CFR, up $1/mt day on day.
In Northern Europe, Platts May assessment for Northern European domestic shredded scrap was at a record high of Eur392.50/mt delivered, up month on month from Eur360/mt delivered in April.
— Rabia Arif, Staff
