Negative sentiment, lower prices impact Italian scrap: Assofermet

Italian steel trade association Assofermet is registering negative market sentiment in March, driven by price decline and weak finished products sales, the association says in its market note monitored by Kallanish.

Sources are reporting continued lower scrap collection, as well as great uncertainty. This “has somewhat delayed the closing of contracts in these first days of March. The reason for this uncertainty is mainly due to the trend of lower sales of finished products, which has not improved, forcing steelmakers to partially review production programmes,” the note says.

February recorded mostly stable scrap prices, without major variations, while steel production slowed towards the end of January. Despite the weaker scrap collection, stocks at several scrap yards were low and prices remained unchanged. In the last days of February, some steelworks, especially in the Brescia area, limited scrap deliveries.

Italian scrap prices are decreasing this month after a period of lull by €20/tonne, or $21.8/t (see Kallanish 13 March).

Meanwhile, the association sees declining pig iron prices in March, in line with weaker finished product prices. Brazilian pig iron levels towards the US market are flat on-month. while a slowdown in pig iron purchases has been recorded on the Turkish market. Assofermet notes a decrease in Russian pig iron volumes on the Chinese market, mainly due to hiking freight rates from the Black Sea, which makes the Chinese market unattractive for Russian suppliers.

“In February, the pig iron market in Italy remained substantially unchanged. There were no price reductions but there was a decline in demand. Availability remains good, although not excessive,” Assofermet concludes.

Natalia Capra France