Italian, EU stainless flats market improves, outlook positive

The stainless flat steel market is steadily improving in Italy and other European countries, although service centre, re-roller and mill sources report continued weak demand downstream, Kallanish notes.

Stocks reached their lowest level in August and apparent demand has now returned, coupled with increasing prices of coil and its derivatives. Purchases in Europe are also being sustained by the lack of coil imports, which are hindered by the European Commission’s anti-circumvention review.

Stainless cold rolled coil prices in Italy for December production are increasing to €2,550-2,600/tonne ($2,691-2,743) delivered, while hot rolled coil is at €2,350/t base delivered on average for material with rough edges, Kallanish hears. European mills are said to be late with their deliveries.

After service centres and their clients purchased in September and October, sales activity is now going quiet, and buyers are adopting a wait-and-see attitude. Activity is expected to again become lively in November when buyers will have to purchase for January delivery. Stocks are said to be higher in Italy and Poland compared to other European countries, such as the Czech Republic, Hungary, France and Germany.

The European market outlook for the fourth quarter has improved, particularly if compared to the lows of Q2 and Q3, although activity remains fragile and downstream consumption limited. The lack of coil imports from Asia and increasing scrap prices due to shortages will continue to support stainless flats prices until the end of the year.

The market situation is evolving steadily, and although demand from downstream users is modest, “prices are rebounding after the lows reached before the summer break”, says Italian trade association Assofermet. “Stocks have returned to normal levels after a long period of high stocks. Stainless scrap prices are rising due to low availability.”

Natalia Capra France