Italian long products mills’ asking prices are increasing by a staggering €100/tonne ($121) compared to last week as the price craze has extended from flats to longs, sources tell Kallanish.
After a lull last week when all Italian longs producers halted sales, new merchant bar asking prices are reaching €400/t base ex-works. Until Monday this week domestic transactions for merchant bar were at €300-350/t base ex-works. Including size extras, contracts are at €720-770/t ex-works. This, however, is forecast to increase by the end of the week to well over the level of €800/t ex-works.
The steep increases are now causing a standoff in the market, but as stocks are low throughout the value chain, distributors are expected to go back to purchasing at the new prices. Concerns are being voiced over the “capability of distribution and end-users to absorb such steep and continuous increases”, a source comments. The issue of bank guarantees and insurance may slow the sector as each truck load will need increased bank guarantees that are difficult to obtain at a time of crisis.
Meanwhile, beams producers also increased their prices by €100/t compared to the beginning of last week. Values for the first category of beams have gone from €380/t base ex-works of last week to €480/t. New sections asking values are now at €870/t ex-works including size extras. The target for the first category of beams is to go over the level of €900/t ex-works, Kallanish hears.
Meanwhile, Spanish beams and merchant bar producers are also said to be going back to quoting this week at increased prices.
Germany is currently driving Italian demand for beams, while strong demand for merchant bar from northern and Eastern Europe is filling Italian and Spanish producers’ order books.
Natalia Capra France