Slow demand plagues Northern European steel longs market; Dutch right-wing coalition plans to stimulate housing market

Demand remained depressed across the Northern European rebar and wire rod market during the week to Wednesday May 22, sources told Fastmarkets.

Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Northern Europe was €630-650 ($684-706) per tonne on Wednesday, stable week on week.

Prices were unchanged in the rebar market, with offer prices reported at around €650 per tonne and trades closer to €630-640 per tonne.

Consumption levels remained weak with minimal restocking reported.

“Due to public holidays in most EU countries this week there is no sign of change, so prices and demand are exactly as they were last week,” one buyer source said.

An improvement in weather conditions and a possible increase in public housing projects initiated in the Netherlands could support an uptrend in demand, Fastmarkets heard.

“Demand is still weak. Hopefully the weather will pick up and it seems like we will have a new government who have agreed to build more houses. A lot of projects have been stopped because of an intense regulatory environment combined with high costs and weak economic conditions, but with the new government they could try to restimulate the economy by initiating more house building as part of their mandate,” a buyer source from the Netherlands said.

New Dutch government
On Wednesday May 15, a deal was reached to form a right-wing coalition in the Netherlands, six months after Dutch nationalist Geert Wilders won a major election victory.

After months of negotiations, the deal will bring together the centre-right VVD, the new NSC party, the farmer’s protest party BBB and Geert Wilders PVV party. No prime minister has yet been elected.

With the most right-wing government in the country for decades, climate change regulation will be deprioritized in favor of more protectionist, nationalistic policies.

The proposed expansion of offshore natural gas extraction and building of four more nuclear power plants by 2040, as well as a €1.2 billion budget reduction of climate funds reflects the deprioritizing of climate-change goals.

Alongside stronger anti-immigration policies, the new coalition plans to stimulate the construction industry with ambitions to build at least 100,000 new homes annually and convert properties such as offices to dwellings to fix the deficit of housing, according to plans published on May 15.

The new government is expected to elect a prime minister by June 2024, Fastmarkets heard.

Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Northern Europe was €645-660 per tonne widening downward by €10 per tonne from €655-660 per tonne one week prior.

Meanwhile, scrap costs dropped week on week after increasing through early May. Some sources predicted further scrap price rises in June.

Fastmarkets’ calculation of its daily index for steel scrap HMS 1&2 (80:20 mix) North Europe origin, cfr Turkey was $373.56 per tonne on Wednesday, down from $380.93 per tonne week on week.

Published by: India-Inés Levy