European welded tube prices are set to increase as re-rollers begin to reduce discounts and output, distributors and re-rollers tell Kallanish.
Producers forecast an improved apparent demand after noticing some increased buying from distributors this month to replenish stocks. Although general market activity remains sluggish amid fears of economic recession, some improved demand is seen persisting this month.
Tube prices are seen close to bottoming. Producers believe that values cannot decrease any further due to the high costs of production, expected further increases in gas prices particularly in Italy and Germany, and expensive transport.
While purchases continue to be implemented for small volumes, in Italy tube discounts have been relatively stable over the past three weeks at 30 and 31 points. Re-rollers see discounts falling in the next days to 26 or 27 points, recovering 3 or 4 points, the equivalent of €30-40/tonne ($30.4-40.5/t).
All tube makers throughout Europe are reducing output. Longer August stoppages are planned for Italian and Spanish producers. Lower availability in September is forecast to support values.
Natalia Capra France