Flat product stocks at German distributors reached their lowest level since January 2016 in October, according to fresh data from the German stockholders association BDS.
Flat steel inventories reduced 6.1% year on year to 1.35 million mt last month, the second consecutive decrease. Looking at historical data from the past two years, volumes this low were last seen in January 2016, when flat stocks stood at 1.32 million mt. Long products dropped by 3.7% on year to 795,697 mt, but were up 1.4% month on month.
The figures mirror comments from flat steel sources, who suggested stockholders were hesitant to make commitments to buy larger volumes over the past months. In October, most buyers were awaiting the Stuttgart sheet fair at the beginning of November to see where the market was headed. A German mill source told Platts buyers were slowly returning to place orders for Q1 following the fair, where mills indicated higher prices. A German service center source said the market was occupied with automotive contracts and that spot activity remained quiet on the previous months’ levels, while stockists were preparing for December. Sources said there was some remaining HRC that could still be delivered late December, but quantities were low.
While long stock levels had been below last year’s levels since April, flat products remained above last year’s levels until July, and have been lower than last year since then.
Sales volumes of long products were stable in October, amounting to 285,545 mt, but flat products saw a decrease of 0.4% to 520,284 mt.
Laura Varriale, SBB DAILY BRIEFING
