EU steel sections prices reach a 24-year high

European domestic steel sections prices gained for another week through June 23, as sources cited fresh deals amid limited supply and transportation issues.

S&P Global Platts’ European medium sections price (category 1, S235 JR) was assessed at Eur1,012.50/mt delivered June 23, up Eur32.50/mt week on week, reaching its highest level in 24 years.

One Benelux-based distributor source cited a deal for 1,000 mt at Eur1,025/mt delivered as most mills continued to hold back offers. “We could buy a small quantity, as the mill was offering limited tonnage and the rest of the mills are still out,” he told Platts.

“Demand is still very strong. Prices are moving up almost on a daily basis,” he said, highlighting transportation issues in the domestic market: “All of Europe is booming like crazy so logistics is not good. Trucks are not available. Normally the availability was same or next day, but now it is taking around three days to one week and even that at completely different price levels. Transportation prices have increased 40%-45% from earlier levels.”

Another distributor source in the Benelux region reiterated the logistics constraint: “There really is a lack of transport. It’s difficult to get trains, trucks, or barges. Material is not coming in as it should. We expect this logistics issue to continue until the end of September.”

The source also expects steel long products prices to remain strong in the near term as mills have continued to report strong orderbooks. However, he expects some price correction in September as the market usually experiences low demand during the fourth quarter. The source cited a tradable value for category 1 medium sections at Eur980/mt delivered.

One European mill source cited mill offers at Eur1,000/mt delivered for category 1, adding that deals were also booked at Eur1,000/mt delivered, though for low quantities. “The orderbooks for all mills are extremely strong. July production is fully booked for us and the German mills,” he said, adding that it is thus perfectly normal to see a slight slowdown in demand, but “nothing to be concerned about.”

— Rabia Arif