German steel inventory levels increased in July as purchases started to arrive at stockholders, while sales started to drop with the beginning of the holiday period, according to data from German stockholder association BDS Aug. 24.
Flat steel stocks increased 8.5% from June to 1.2 million mt in July, seeing a 9.8% year on year decrease as July 2020 was still heavily impacted by pandemic-related demand drop.
Stock levels for long steel products grew 2.6% on the month to 791,193 mt, while year on year they dropped 2.9%.
Though sources told S&P Global Platts that they were currently cautious not to increase stocks too fast amid an uncertain price and demand development after the summer holidays, the overall sentiment across the market remains largely optimistic for prices and demand to be around current levels.
The road towards price recovery started end of June last year when the Platts daily hot-rolled assessment was at it’s lowest point recorded at Eur396.5/mt EXW Ruhr and increased to an all-time high at Eur1,190/mt EXW Ruhr June 25 this year, before the summer lull set in. The HRC assessment stood at Eur1,140/mt EXW Ruhr Aug. 24.
Flat steel sales volumes dropped 1.3% on the month to 525,292 mt, recording a year on year increase of 6.7%. Long steel sales volumes decreased 7.3% on the month to 300,205 mt, with a year on year decrease of 3.1%.
With the summer holidays starting in July, a sales drop is not unusual, but some market participants said that they were trying to keep their ex-stock selling prices stable amid the demand lull which results in fewer sales volumes.
— Laura Varriale