German rebar mills tried to increase offers over previous contracts last week, with the modest rise seen as more realistic than those announced in December.
The base price would now be at €380/tonne ($398/t), which plus the standardised size extra of €265/t brings the delivered price to €645/t.
“The mills did not succeed with their wish to push up prices in the new year, so now this is a new run-up,” one buyer tells Kallanish. In combination with elevated prices for scrap and electricity, he thinks it highly probable the mills will prevail. “We might soon see €650/t delivered,” he says.
Others do not see a new price level coming soon and have not heard of higher prices, given the low level of inquiries and orders. One manager says the latest offers he saw last week still put rebar at €360/t and wire mesh at €460/t.
For rebar, the delivered price would be at around €625/t, which other sources consider realistic for recent transactions.
By December, many customers had placed orders for replenishment at base prices well below €350/t, leading to full order books that encouraged mills to target €400/t. This level was however never attained.
The current hike is more likely to succeed, or at least to stabilise prices. One analyst says he sees prices moving only sideways until April.
Christian Koehl Germany
