Italian service centres are “caught in the grip between producers and consumers, in a market characterised by uncertainty,” bemoans steel trade association Assofermet in its market note sent to Kallanish. They continue to operate despite, according to them, insufficient margins.
The recent increase in quotes from EU and non-EU steelmakers is compounding supply restrictions stemming from EU safeguard measures and pushing distributors and re-rollers to increase their May prices.
April was a slow month in terms of volumes sold, also due to the several bank holidays observed in Italy and Central European countries. Some positive signs however came from end-users. Fearing a price rebound for coils, they increased their sheet and strip purchasing volumes, stocking up for May.
“Even though the conflicts in Ukraine and the Middle East are bound to still impact world economies, some signs of optimism are coming from the EU for the long-awaited … round of lowering the cost of money [interest rates], which is expected to finally begin in June,” Assofermet states. It adds that service centres’ raw material stocks are slightly above average due to the slowdown in first-quarter sales.
After the April weakness in the downstream sector, the association sees a price rebound shaping up in May for both flat and long products, with volumes in line with 2023. It states that the market no longer expects prices to decline but doubts the price increases will turn into a real recovery.
Natalia Capra France
