Italian merchant bar and sections producers are stopping sales this week, following increasing prices of scrap and finished long products. All flat and long steel producers have withdrawn from the market as scrap prices are rising each day. Longs contract prices are surpassing quotes, amid a “frenzy” leaving mills and buyers baffled over which prices apply, sources tell Kallanish.
Merchant bar domestic values have reached €300/tonne ($364) base ex-works on average, or €720/t ex-works including €420/t size extras. On Friday last week some producers were asking for €360/t base ex-works for a short period of time, but all mills have stopped sales this week. Customers expect new asking prices to reach the level of €400/t base ex-works, sources say. Domestic demand is said to be at normal levels but stocks at distributors are low.
Beam producers are also stopping sales after the first category of sections increased in contracts to €360-380/t base ex-works. Including €380 size extras, beams now start at €740-770/t ex-works, a €20/t increase on average compared to the first week of May. Sections producers should start quoting again by the end of this week, sources say.
“Prices are changing every day,” a source comments. “Distributors lament a lack of stability and do not know what price to quote. Some are resorting to also stopping sales and waiting.”
Another distributor warns stability is essential as end-users cannot absorb continuously changing prices. Some customers are putting off their orders because “working in such a mad market is madness”, he exclaims. Buyers believe that if stability is not reached, a price collapse could be possible.
Natalia Capra France
