Italian pipe and steelmaker Marcegaglia has published a new price list that changes the pricing structure for welded tubes, in line with recent changes in the coil market, Kallanish notes.
Sources in the sector believe the company is modelling the new structure on the coil pricing mechanism. Under the new list, welded tubes prices will consist of a base price plus specification-based extras, mirroring the pricing formula used for coil. On tubes, the base price will remain fixed, while the extra will vary by specification. Discounts will be applied to the base, whereas under the previous system discounts were applied to the total value.
The new price list has been published, with full implementation expected by late September or early October as customers adapt to the revised pricing model, Kallanish understands. The update will include price increases, although Marcegaglia has yet to set final levels as it assesses the recent rise in coil prices.
Updated transport costs have also been integrated into the new list. Freight rates have surged in recent months, and finding trucks and drivers is increasingly difficult. Logistics are becoming a serious financial burden on the price of steel per tonne with bottlenecks causing delays across the value chain.
According to one source, the rising cost of fuel and freight will push the tube business towards greater regionalisation. Globalisation is fading due to protectionism, and regional presence will become increasingly important to improve customer service and contain costs.
Several other European pipe makers are also considering price increases in response to higher coil and transport costs. On the coil side, rising costs pushed ArcelorMittal to increase prices across Europe in September. The revised base price for hot rolled coil in Southern Europe is at €790/tonne delivered, and €770/t for Northern Europe, levels seen as workable for October and November. With HRC purchase prices now well above €700/t base ex-works, tube makers are expected to raise prices despite uncertain downstream demand.
Another source expects a broader transformation of the welded tube sector as European protectionism reshapes supply chains. With competitively priced imported HRC no longer readily available, producers will need to focus more on value-added services, quality and processing capabilities than on raw-material sourcing.
Tube demand in central and southern Europe remains subdued, with no clear recovery in consumption. However, market sentiment is improving as imports decline. Buyers built inventories ahead of the July quota changes but are expected to return to the domestic market in October and November as stocks are depleted.
Author: Natalia Capra
