Italian coil market shows recovery signs

While some Italian coil producers are halting sales this week, others are beginning to say prices may increase. This is mainly due to lower production and several stoppages in Italy starting from next week until the last week of August.

Against the backdrop of the downturn in flat steel products in Europe, coil prices seem to have reached bottom. Italian hot rolled coil values are stable week-on-week but demand remains subdued, market participants tell Kallanish.

In Italy, Acciaierie d’Italia, the joint venture between ArcelorMittal and state-owned Invitalia, is shutting down blast furnace no.2 and restarting it at the end of August. Arvedi will also idle production starting next week, although the company has refused to comment.

Over the past two days, however, the Italian market has become more dynamic, as large buyers seem to be returning to a buying mood. Optimism is slowly spreading and if mills hike offers, sources believe they will be successful in stopping the drop in sales prices.

Service centres have not increased their HRC purchases, but some demand is being registered for hot-dipped galvanised coil, although for the usual small tonnages. Italian HRC contracts remain at €750-780/tonne ($700.4-780.5) base ex-works, with lead times of end-July. HDG values start at €900/t base ex-works but this price is also sometimes offered delivered, sources suggest.

Natalia Capra France