German stockholders started to reduce inventories again in February following an unusually brief restocking phase, according to the latest data from trade association BDS Tuesday.
Stocks were down steeply year on year too, the stockholder association said, particularly for flat steel. Flat steel saw a 18.4% year-on-year decrease to 1.2 million mt in February, whereas long steel stocks fell 8.4% year on year to 817,451 mt.
On a month-on-month basis, the data suggested stockholders started to destock again in February, making the typical restocking phase at the beginning of the year unusually short in 2020.
Flat steel stocks fell 1.5% month on month, while long steel stocks dropped 0.9%, the data show.
Sales of stocks were up for both long and flat steel stocks year on year, but exhibited a mixed picture on a month-on-month basis. While sales for long products increased slightly by 1.5% compared with January to 285,618 mt in February, sales of flat steel stocks decreased 8.2% to 551,946 mt.
German sources told S&P Global Platts that stockholders did not massively restock their inventories and started to sell again in February when mill prices were increasing, but the stability of prices was unclear.
Sources said the selloff is currently continuing amid the uncertainty for steel price developments as the coronavirus pandemic continues to rage in Europe, indicating that March numbers will show further decreases. Some sources said back-to-back purchases were being carried out.
— Laura Varriale