September presented significant challenges for long product sales in Italy while insights from sellers and buyers indicate that October is unlikely to show any improvement, sources tell Kallanish.
Prices appear stable on a month-to-month basis, with minor fluctuations of €10/tonne ($10.84/t).
The Italian merchant bar sector is currently experiencing major difficulties due to sluggish order volumes. Prices remain largely stable as the primary producers have successfully maintained their position against falling bids.
Extended production reductions in the segment are anticipated in November to align demand with supply. Some producers are stopping for three weeks while other longs mills will take advantage of the 1 November public holiday to cut production for 1-2 weeks and implement temporary layoffs.
“There is no work downstream,” an agent comments. “Customers are not even in a wating mood. They just call us when they need material and do not even negotiate prices. They buy what is necessary for the next two weeks to match their low orders”.
The market outlook suggests that difficulties will persist through year end, with sources expressing scepticism regarding the potential for price increases in this weak environment.
“In September and October, the market seems frozen; we have been suffering on merchant bar but have gathered a few more orders for sections,” another agent says.
The better demand for sections is attributed to the current low availability as the main producer is said to be late with deliveries, according to sources. Beams supply is forecast to remain extremely limited. According to sources, prices for the first category are at around €800/t delivered. The current range for domestic merchant bar is at €280-290/t delivered or €700-710/t delivered, including size extras.
ArcelorMittal has recently announced it is to increase its prices for long products throughout Europe. The decision was driven by the present unsustainability of prices and the increasing costs of raw materials globally.
According to sources, the steelmaker is increasing prices of all commodity grade longs, including rebar, beams, and drawing quality wire rod, by €40/t.
Natalia Capra France
