German steel sales, stocks lower on year in October: BDS

German steel products sales in October fell 14% year on year to a 10-month low 743,703 mt while stocks were also lower, steel stockholders’ association BDS said Nov. 25.

The fall coincided with weak end-of-year prospects for the steel market amid expectations of a decline in German GDP in the fourth quarter.

Sales of long products, used primarily in construction, were down 14% to 230,809 mt, with sales of flat products, used in automotive and construction industries, down 8.6% to 467,216 mt.

October sales in all product categories were lower than the average sales recorded in Q3 this year, the BDS data showed.

Germany’s stocks of all steel product categories stood at 2.16 million mt in October, 1% lower than in October 2021, according to BDS, with stocks of long products 1.6$ higher at 792,811 mt while flat products were down 1.2% at 1.33 million mt.

Economic backdrop

The German composite Purchasing Managers’ Index (PMI) for November, published this week, rose 1.3 points to a three-month high 46.4, with manufacturing PMI up 1.6 points to 46.7, as manufacturing firms reported their output fell by less than in the prior month as supply disruptions eased.

Economists at UBS said in a Nov. 25 note that the assessment of Germany’s current economic conditions, by contrast, slipped further to its lowest level since February 2021, supporting the view that GDP will fall in the current quarter, although the recession may be more moderate than originally expected.

“Despite the improvement in the November reading, our ifo [income from operations] business cycle clocks show the overall German economy in the recession quadrant (below-average current conditions and below-average outlook), driven by manufacturing and services,” the UBS economists, led by Felix Huefner, said.

While fears of physical gas rationing in Germany this winter have now eased, uncertainty continues high in the energy-intensive sectors, according to UBS.

Platts, part of S&P Global Commodity Insights, assessed Northwest Europe hot-rolled coil at Eur605/mt ($627/mt) ex-works Ruhr on Nov. 24, down Eur5/mt on the day. The price has fallen 348% since the start of 2022.

Author Diana Kinch, diana.kinch@spglobal.com