Spanish steel distributor representatives anticipate certain market fluctuations in the following months, but price volatility is seen coming to an end, Kallanish heard during Tuesday’s EUROMETAL Iberia Steel Net Forum in Barcelona.
The new economic reality is seen requiring new solutions from both producers and the distribution chain in Spain. The sector says some old concerns remain, while it faces a challenging scenario amid high energy and transport prices.
“We have enough capacity to supply the market,” said Spanish distributors’ association Unión de Almacenistas de Hierros de España (UAHE) president Roberto González. “Almost 90% of the companies in the sector are small and must undertake an innovation process because the market demands it. Digitisation can improve the sustainability and profitability of services.”
According to the executive, there are concerns about plans by some steelmakers to improve their portfolio by including distributors’ main services.
Ignacio Mir Coll of distributor Hierros del Mediterráneo said good management by companies in the face of the challenging economic panorama does not consist only of selling steel, but also of supplying better and innovative services to customers.
“The end-user must understand that our service has a cost,” he observed. “The differentiation of these along with good pricing policy can guarantee our margins.” According to Mir Coll, both steel mills and stockists in Spain have a suitable role in the value chain, although “certain errors in distribution have not made it possible to see in a better way the value of the steel sales process by stockists”.
Sustainability must be an additional argument to grow the relationship with steelmakers, pointed out Fernando Moraga, executive director of Grupo Hierros Alfonso. “The distribution chain is an essential and fundamental link that completes the steel industry. Manufacturers need to start taking us into account when making their pricing decisions.”
According to Manuel Nobre, president of Portuguese steel distributor association Açomefer, Iberian service centres have been very important in giving stability to the steel market after the Covid-19 lockdowns, as well as in the current situation with the war in Ukraine. “We have been able to restore supplies and maintain the recovery. Customers are increasingly aware of the added value we are giving to steel. We must continue transforming the mentality in our business from being a simple merchant to providing high-value services. The factories cannot replace us,” Nobre commented.
During the conference, the organizers avoided talking about steel prices due to anti-competition regulations, although it was implied that these currently reflect market risks but are often supported by rumours. “False information plays against us, since the end customers know mills’ prices and put pressure on us. The speculative trend must be controlled with a more in-depth analysis,” Nobre concluded, with other participants agreeing.
Todor Kirkov Bulgaria