Apparent demand for long products is seen recovering slightly in the second quarter in southern European countries such as Portugal, Italy, Spain and Greece, while real demand should remain depressed, mill sources believe.
Apparent demand for wire rod, merchant bar, rebar and sections is seen resurfacing a few weeks after Easter, given international scrap prices have stopped dropping. Sources who spoke to Kallanish believe scrap values will stabilise in the coming weeks, supported by low availability and strong EU and international demand.
The European longs market is being impacted by lower consumption from the construction sector. However, southern EU countries are performing better than northern Europe, with better shipments in Q1 2024 compared to Q3 and Q4 2023. Rebar sales are particularly weak in France and Germany where the construction sector has suffered a strong setback. Sales are also better in eastern European countries such as Poland, as well as the UK.
Rebar prices in northern and eastern Europe are at €610-630/tonne ($662-684) delivered, depending on tonnage, sources suggest. All markets are seen remaining quiet this month, with customers shunning sales until after Easter.
In Q1, merchant bar and sections have suffered low apparent and real demand, but some orders are now resurfacing. Most buyers in Europe restocked in November and December last year and have been destocking ever since.
Merchant bar is the worst-performing product for sales at present, sources point out. Prices in northern Europe have fallen from over €700/t delivered to an average of €650/t delivered. The merchant bar stagnation is seen continuing in Q2, albeit with brief spells of slightly better demand.
Apparent demand for sections should resurface after a long period of destocking, bringing some price stability, but woes over consumption continue. Wire rod may also see renewed demand in April, with fewer imports expected amid depleting stocks. Its prices are at some €630-650/t delivered in Europe.
Rebar prices are forecast to see some stability in southern Europe in the coming quarter, but the German and French markets will continue to suffer.
Natalia Capra France
