German rebar mills are attempting another price hike gentle enough to be accepted by the market, observers believe.
After some bold announcements in December and January, mills have lately tried for more modest hikes, which have brought base prices to a solid €380/tonne ($415). The upcoming hikes are heard to be for €10-15/t, which would inch base prices towards the €400 mark, which was last tried in December. The delivered price, including the fixed size extra, would thus come to €660-665/t.
“Three leading mills have announced this [hike], and the others will likely follow,” a buyer of a distributor chain tells Kallanish, indicating that he finds the increase reasonable enough to be accepted. Another buyer concurs, noting that February’s prices were realistic, and that he expected another step to follow.
He notes wire mesh prices could develop stronger than those for bar, against the background of reports of a possible shortage of wire rod. He cites the price recommendation of a large purchasing cooperative, which gives base prices for bar at €390 and for wire mesh at €500+.
Another manager has informed his customers about the increases, but warns against making big restocking purchases that could fuel price hikes out of proportion with the actual market.
Such advice puzzles the buyer of the distribution chain. “We tell our customers you better buy now, because we don’t think prices will go down any more.”
Christian Koehl Germany
