Availability of pickled coil, particularly of higher thickness, has been significantly below normal in Italian market, sources told S&P Global Commodity Insights in the week to March 20.
Technological issues on one of Arvedi’s lines and low water levels affecting production at Delna site, owned by CLN, are behind the shortage.
“Supply of pickled and oiled coil in Italy is generally tight, and any issues causing production to drop immediately hit the market,” an Italian trader said.
Arvedi has had technological issues on its push-pull pickling line for processing of coil with 8-12 mm thickness, and the line has been stopped, a source close to the mill said. The company did not respond to S&P Global’s requests for comment.
The Delna plant is having “full revamping of one pickling line processing thicknesses over 6 mm, and low levels of water in lakes and rivers are affecting production,” the source from the company said.
An Italian distributor said Delna can’t offer “from 6 mm and up because of lack of water issues,”
Delna’s pickling line that can process coil with thickness from 1.5 mm to 15 mm has a capacity 450,000 mt/year. Another line that processes coil from 1.4 mm to 7 mm has capacity of 400,000 mt/year.
As a result, the premium for pickled coil over dry HRC increased to about Eur40-50/mt from around Eur20-30/mt, according to market sources.
Platts assessed domestic prices for hot-rolled coil in South Europe at Eur820/mt ex-works Italy March 20.
— Maria Tanatar