The release of a new size extras price list for rebar in northwestern Europe last week is a signal that base prices will be lifted too.
The announcement of new size extras “has certainly shaken us all over”, one Austrian buyer states. Although a new version of the previous size extra list issued in 2015 was long overdue, it surprised many that it was published now.
The new list comes from only two mills so far, Badische Stahlwerke and Marienhütte. And not all buyers are aware of the development yet, like an eastern German manager, simply because “we do not buy from them”, he notes.
The two mills are unlikely to consider accepting bids at old prices anymore. “The new size extras are carved in stone with effect from 4 August,” the Austrian buyer says.
Other mills in the region were contacted by Kallanish about their plans to follow suit, but did not come back with a statement before deadline on Friday. Virtually all other rebar mills in Germany, Switzerland and France belong to Italian groups, which have now entered their summer holidays and left the market for several weeks.
It seems the timing favours the Italian mill owners. “The Italians can comfortably lay back and take their time to make a decision,” one observer says, although he has little doubt they will follow suit.
He notes base prices have been brought up, too, in the wake of the size extra hike. Offers he received as a delivered effective price were some €30/tonne ($35) higher than in July. The size extra for the standard thickness 12mm is up €15/t in the new list, so the offers suggest a hike of the base price by the same degree.
In July, base prices for rebar sunk to around €350/t ($408) in Germany and Austria from domestic mills, and will likely be lifted in August. So far, activity is too sparse to judge the success of a price hike.
Christian Koehl Germany
