Flat steel inventories in Germany fall further, continue at historic low

Flat steel stocks at German stockholders dropped further in April, continuing on a historical low, resulting from a persistent shortage in the market, according to data from the German steel stockholder association BDS.

Average flat steel stocks in April fell 1.9% month on month to 1.03 million mt. according to the data obtained by S&P Global Platts May 27. Stocks were also down 16% year on year.

Sales volumes in April fell 15% month on month to 546,483 mt, but they rose 41.1% year on year, reflecting the near standstill of the market last year when pandemic-related restrictions were first put in place.

Contrary to flat steel, average long steel stocks in April grew marginally by 0.5% month on month and 1.9% year on year to 819,929 mt. Average sales, however, fell 11.3% month on month to 290,778 mt. In comparison to April 2020, sales grew 3%.

According to Platts monthly German steel sentiment survey published earlier this month, market participants expect further declines in stock levels, with an index of 28 – 50 denotes stability – as stockholders scramble for material, particularly flat steel, with the industry unable to restock in large volumes.

Hot-rolled coil prices have continued to hit new all-time highs since March as a result of the shortage. Platts daily HRC assessment EXW Ruhr stood at Eur1132.50/mt May 26.

European mills continue to have long order backlogs and sources say there are no significant capacity increases planned that could ease the shortage in short or medium term.

— Laura Varriale