Considering weak finished products sales, Italian steelmakers exclude a short-term rebound in scrap prices, with a recovery unlikely to happen before next spring, Italian trade association Assofermet says in its market note monitored by Kallanish.
Scrap sales volumes remain low due to reduced demand from mills, but the relative shortage ensures that prices at least remain stable. Margins, however, have deteriorated significantly. “Despite the above scenario, the hope in a possible improvement remains, even if it’s difficult to make any predictions in the short term,” the association says.
Market prices were stable in September. The flow of scrap towards mills was good and regular depending on different production needs. “Unfortunately, despite the expectations of a recovery [in September] after the weakness of previous months, sales of finished products were limited, forcing steel mills to reduce production costs. Today, scrap yards at all steel mill are full, which may lead to lower demand for scrap if the weakness in finished products persists,” the note continues.
Meanwhile, the lack of pig iron availability from some Russian producers continues. “Despite the introduction of the 7% duty on Russian pig iron exports, at the moment there are no repercussions on prices considering the large availability of material at the port of Marghera. Therefore, values remain unchanged amid a downward trend considering the continued low purchases by steel mills,” Assofermet concludes.
Natalia Capra France