After falling in November, Italian plate prices are now flattening on-week but demand is persistently slow, Kallanish learns from market participants.
Due to the current economic uncertainty, customers are adopting a wait-and-see attitude and even large buyers are purchasing lower volumes compared to usual. Sellers believe plate is suffering from the negative influence of all other steel products and argue that the current gap between S275 grade and hot rolled coil prices is too large.
Italian sellers are quoting December lead times. Contract prices are at some €820-830/tonne ($852-862) ex-works for the basic S275 grade and about €850/t ex-works for the higher 355 grade, which remains in short supply.
Despite the weak year-end sales performance, sellers will report solid results for 2022, considerably higher than those achieved in 2021, which was a record year. The market is currently absorbing lower volumes of coil derivatives. Plate sales in 2023 will however be supported by investments in infrastructure financed by the European recovery fund, as well as by the flourishing renewable wind power sector.
Meanwhile, merchant slab prices continue to soften. Russian slab prices corrected down by another $10-20/t to $420-450/t fob, depending on grade, from western Russian ports. Offers to Turkey lost around $20/t in two weeks to $420-430/t fob, with freight fluctuating between $35-50/t depending on volume and port (see Kallanish 23 November newsletter).
Natalia Capra France