The Italian distribution sector is registering weak demand for long products, welded tube and sheet after a surge in sales of sheet and tube before the August summer break started. Considering the quiet market, local service centres and distributors fear the current wave of European mill price increases may cause the market to stall again, Kallanish hears.
Some re-rollers are particularly aggressive on tube and sheet prices, with the aim of recovering volumes. Thanks to some interesting prices heard in the market in recent days, sellers are managing to bring in orders.
There is a similar situation for sheet where, despite producers being expected to implement significant increases, some sellers are decreasing values by €20-30/tonne ($19-29) to fill order books. This will however imminently come to an end as all sellers are or will increase their prices, a move that is not being well received downstream.
The slow sales of the past two months are causing stocks to remain high. End-user demand has been particularly subdued this week and low-priced imported material is discouraging buyers from purchasing locally. Following the latest increases, many firms are looking to import cheaper sheet, rebar, merchant bar and sections.
Italian merchant bar prices are hiking to the level of around €750/t base ex-works. Section producers are beginning to communicate an increase of €100/t for the first category of beams. ArcelorMittal is communicating to its clients the decision to raise immediately spot prices for commodity grade longs by €150/t across Europe (see Kallanish passim). The hikes are meant to align prices to skyrocketing gas and electricity rates, Kallanish notes.
Natalia Capra France
