Northwestern European integrated plate mills are seeking to achieve higher prices going forward, although the prospects for realising this in the current market are not certain.
“We are in negotiations for the third quarter, with mills asking for €60/tonne ($70) more quarter-on-quarter,” one market source tells Kallanish. In line with others who have observed higher prices in spot offers in recent weeks, he sees the mill target’s reaching €900/t for S355 delivered. He doubts that it will be achieved in full in the negotiations, “but it will certainly at least be +€30/t”.
Thanks to project contracts, German mills are well utilised, and therefore can afford to ask for higher prices. These mills are licensed for projects by railroad operator Deutsche Bahnfor example, “which are more profitable, but also take longer for certification,” one manager explains.
According to numerous players, German mills are utilised until the end of the year now, and some special grades are not available before the New Year. In addition, a blast furnace repair outage at one mill and impairments of waterway transports have caused longer lead times for high-end plate, the manager says.
Hence, the full price hike by the integrated mills may be achievable for high-end products which are in demand, but not for commodity plate, observers believe.
“Hardly anyone will be willing to pay €900/t,” one manager notes. He warns that “the next two weeks will have to show if the demand is given, otherwise we might see a backlash.”
