The Italian long steel market deadlock has continued this week. Values are reported to be falling for merchant bar and rebar, after sales in the first two months of the year were slow for most longs, sources tell Kallanish.
However, scrap prices are increasing in Italy and Europe by some €20-25/tonne ($21.1-26.4), while 1 April will see the expiry of the energy cost relief tax discount implemented by the Italian government. Some producers are therefore suspending sales and intend to ask for significant price increases.
The past weeks were quiet for merchant bar sales in a stagnant market. The distribution sector continues to buy back-to-back or use its stock to satisfy the weak consumption. Merchant bar contract values remain flat on last week at €480/t base ex-works on average. Including size extras, contracts are at €900/t ex-works, sources suggest.
Buyers and sellers say January and February were good months for sections sales, despite there being cheaper Spanish offers available. Domestic values for the first category are also flattening at €950-960/t ex-works, depending on tonnage and client. Buyers expect beam prices to hike on higher production costs in the coming days.
ArcelorMittal told its European customers this week of its intention to raise long product offers, in order to recover some margin loss due to higher input costs. According to market sources, the company is increasing offers for commodity-grade products by some €30/t. Longer-term contracts for the second quarter for higher-grade products are being raised by a minimum of €50/t (see Kallanish 7 March).
Natalia Capra France