European domestic steel sections prices continued to rise this week, as some buyers booked volumes amid reduced production at mills.
Platts European medium sections price (category 1, S235 JR) was assessed at Eur535/mt delivered Wednesday, up Eur5/mt week on week.
A deal for 500 mt was heard at Eur535/mt delivered Benelux, according to a distributor source, while a European mill source cited a tradable value at Eur535-Eur540/mt delivered, and a mill offer was heard at Eur540/mt delivered, according to another distributor source.
“The mills pushed up prices due to their reduced production levels, while Benelux end user activity is about 30%-40% less,” the first distributor source said.
ArcelorMittal resumed activity at its Differdange and Belval sites in Luxembourg on March 30, while mills in Germany and Spain are also understood to be working at reduced capacity utilization, market sources said.
Some Italian mills are hoping to restart deliveries soon, with one trader citing an indicative target date of April 15-16.
“The Italians lack material and this should lead to a delay of at least a month, while mill deliveries are also a concern – it is very difficult to find trucks right now so stockholders are seeing a lot of demand now,” a second Benelux distributor said.
Some market participants also cast doubt on the possibility of sustained price increases, even after the coronavirus pandemic has passed.
“Suppliers have smaller rolling programs so they can push prices higher now, while it is also harder to get scrap so that could also support prices,” a third distributor source said. “Even if the pandemic lasts just one month more, we would already start to enter the holiday season, which will affect demand so I don’t expect continued increases into the summer.”
— Viral Shah