Italian merchant bar prices have been pushed up again this week to the level of €280/tonne ($338) base ex-works, market participants tell Kallanish.
Demand however seems to be reaching a dead-end as the prospect of falling scrap prices seems to be increasing. As a consequence, large distributors and purchasing groups have now decided to adopt a wait-and-see attitude.
Transaction values for merchant bar have gained €100/t ($120) since the beginning of January, in line with skyrocketing scrap values. Producers’ quotes went up in December to €180/t base ex-works and gradually reached this week’s level of €280/t base. Current merchant bar transactions in Italy are at €250/t base ex-works on average, or €670/t ex-works including €420/t size extras.
Meanwhile, Italian heavy sections producers are also pushing up their prices sharply. Transactions have reached €340-350/t base ex-works for the first category of beams, in line with increased asking values. Including €385/t size extras, contracts are now at €730/t ex-works on average. Prices increase by €20/t for each subsequent category, sources say. December contracts were at €200-250/t base ex-works, or €585-635/t effective ex-works, Kallanish notes.
Scrap prices in Italy have increased this month by €100/t on-month, in line with French and German hikes (see Kallanish 13 January). However, a trend reversal is beginning to happen and mills are now discussing decreasing values for new scrap contracts.