Dutch flat steel service centre Noviostaal confirms the outlook for flats prices in Europe remains positive. This is thanks to a recovery of activity in key markets and the need for mills to widen their low margins.
The company says in its newsletter published this week it is receiving indications that automotive production in Germany, France and Italy is recovering faster than expected. It also adds that Sweden is already registering pre-coronavirus economic activity levels.
The expected recovery in demand together with persistent low margins for European mills suggest prices for flat products will continue to move up further into the fourth quarter. “In summary, it can be said that all signals for a price increase are green and we assume that we will have to deal with higher steel prices in the coming months,” Noviostaal observes.
According to Kallanish price series, hot rolled coil in northern Europe recovered €20/t ($24) since the beginning of July to €420/t ex-works base last week. Noviostall confirms this and indicates mills are pushing for a further €30-40/t increase for new orders, with some targeting yet further price hikes for Q4.