Italian plate market enters quiet period with cautious hopes for price recovery in Q1
In Italy, trading picked up slightly in the past week, with buyers finalizing their bookings for the first quarter ahead of the year-end.
But trading was slow in general, and producer sources said they were getting 20-40% fewer orders in November-December compared with the same period last year.
As Fastmarkets reported earlier, Italian plate producers were trying to increase prices for new rolling and were targeting offers of €650 ($682) per tonne ex-works for the first quarter.
Some suppliers said they have had limited success, managing to seal higher prices in bookings with some clients.
But another supplier said that higher prices could have been sealed mainly for project business, while the spot market remained weak.
“For small- and medium-sized businesses, there is a struggle; there is fierce competition downstream. We will see if distributors and steel service centers manage to [increase] prices downstream in the new year,” a supplier source said.
Most buyer sources estimated tradeable prices at no higher than €630 per tonne ex-works in the week to Wednesday, claiming that some suppliers were still accepting lower prices to fill gaps in order books, particularly for commodity grades.
Deals were reported at €630-640 per tonne ex-works during the assessment week.
As a result. Fastmarkets’ weekly price assessment for steel domestic plate, 8-40mm, exw Southern Europe was €630-640 per tonne on Wednesday, narrowing upward by €10 per tonne from €620-640 per tonne on December 11.
Domestic suppliers were taking prolonged production stoppages in December and January, and industry sources expressed hopes that the move might help to balance the market so the Italian rerollers would be able to achieve higher prices in new-year trades.
The recent news about the safeguards review, announced by the European Commission on Tuesday December 17, also sparked some cautious optimism among sellers.
No details have been revealed yet about the potential changes to steel safeguard measures, but sources familiar with the matter said that quarterly quotas for some origins will likely be reduced and/or new individual quotas might be imposed.
Sources suggested that the Commission’s move will further limit appetite for overseas bookings and therefore support a rebound in European prices in the medium to long run.
“We are heading into [an] era of global trade wars and growing protectionism. Looks like reliance on domestic mills will only increase in 2025,” a buyer in Italy said.
Sources said that interest in overseas plate has already been somewhat cooled by talks about a potential anti-dumping investigation, and the recent safeguard news announcement might result in stronger reliance on European plate.
Some suppliers — notably South Korea, Indonesia and India — have significantly increased heavy plate shipments to the EU in 2023-2024.
Notably, in January-October 2024, total quarto plate deliveries from South Korea to the EU amounted to 640,513 tonnes, compared with 618,070 for the entire year of 2023, Global Trader Tracker (GTT) data showed. In 2022, South Korea shipped only 357,504 tonnes of plate to the bloc.
In the first ten months of 2024, India supplied 439,415 tonnes of quarto plate to the bloc, compared with 349,901 tonnes for the entire year of 2023.
In January-October 2024, quarto plate deliveries from Indonesia to the EU stood at 302,109 tonnes, compared with 328,894 for the entire year of 2023.
Offers of February-shipment plate to Italy from South Korea and Indonesia were heard at €570-580 per tonne CFR.
Assofermet: downstream slowdown, pricing pressure Italian service centres
Reduced sales volumes and high costs continue to plague the Italian service centre and distribution sector, which is wedged between steelmakers and end users, Italian trade association Assofermet says in a market note seen by Kallanish.
In response to the upstream price increases for coils, service centres are now being compelled to raise prices of coil derivatives and pass the hiked costs on downstream. Firms are aiming to enhance financial positions and secure margins for the conclusion of the year.
The prevailing sentiment for December is one of a wait-and-see attitude. “November saw the consolidation of rising [hot rolled coil] quotes from EU steel mills despite much weakened demand from the downstream market, which still does not seem to be waking up. It is precisely this decoupling between the upstream production sector and downstream consumption which both confuses and worries all operators,” the note states.
Steelmakers are under pressure to enhance their financial performance, and the production cuts announced for 2025 are a response to persistently pressured margins. Assofermet is observing a stagnation in demand from various end users, which is preventing any new growth in prices and volumes.
EU producers, however, are rigidly insisting on increasing prices, driven by a reduction in available import quotas alongside anti-dumping duties, which make purchasing from the import market uncompetitive.
In November, distributors experienced a notable decline in volumes, accompanied by reductions in margins and turnover, primarily driven by persistent price weakness.
Assofermet recently launched a new calculation platform enabling coil buyers to assess potential anti-dumping and anti-subsidy duties as part of European Commission investigations. The initiative aims to support members’ understanding of the EU regulations regarding anti-dumping investigations. The calculator assists in evaluating the potential timing and imposition of duties.
Natalia Capra France
Worthington to acquire majority stake in Italy’s Sitem
Worthington Steel is acquiring a controlling interest in Italy’s Sitem SpA through subsidiary Tempel Steel Co, Kallanish learns.
In a statement, Worthington says it will own 52% of Sitem, a producer of automotive and industrial electric motor laminations and accessories.
Geoff Gilmore, Worthington Steel’s president and chief executive, explains that the Columbia, Ohio-based metals processor entered into the agreement to increase its exposure to the automotive market.
“This investment aligns with our strategic goal to grow our electrical steel lamination business and expand our customer reach. Sitem Group brings 50 years of experience and is one of the largest producers of electric motor laminations in Europe. The Worthington Steel and Sitem Group leadership teams bring valuable expertise and relationships to spearhead the expansion of our global automotive programs in the production of electric vehicles and hybrids,” states Gilmore.
“We are excited to partner with Worthington Steel,” adds Marco Bartoloni, ceo of Sitem Group. “This investment and partnership will enable us to better serve global automotive and industrial motor customers. Their philosophy aligns with our values and is a great fit for our employees.”
As the deal currently stands, Worthington is acquiring shares from Sitem Group’s existing shareholders and transaction is expected to close in early 2025, subject to the receipt of applicable regulatory approvals and customary closing conditions.
Latham & Watkins LLP served as legal counsel to Worthington Steel on the transaction. Sitem was advised by UniCredit as financial advisor, Antonello Marcucci as senior advisor and Bird & Bird as legal counsel.
Sitem Group operates six facilities across Europe: three in Italy, and one each in Switzerland, Slovakia and France.
Kristen DiLandro USA
Italian plate producers push up prices
Italian heavy plate prices are on the rise, driven by a resurgence in domestic demand and producers’ price hike attempts in order to restore margins, Kallanish notes.
The market is showing signs of increased activity, as reported by mills; however, distributor sources indicate that weak activity persists downstream. Given the current environment of tight margins and insufficient profitability, there is a request for a €30/tonne ($31.7) increase for deliveries scheduled in December. One mill has plans to raise prices further for deliveries scheduled in January and February.
Producers are indicating a lead time of approximately two weeks. It appears large customers have not resumed their purchasing activities, having acquired substantial quantities from the import market in recent weeks. Distributors are still purchasing limited quantities from producers’ inventories.
One producer is reported to be maintaining a diverse inventory of various grades and measures, which is especially beneficial in a market characterised by buyers who favour frequent purchases of smaller quantities.
Producers are now quoting domestic S275 grade plate at €650/t ex-works and S355 at €680-690/t. Current contracts for S275 grade are priced between €620-630/t, whereas S355 is at €20/t higher. The present booking prices for Asian slab remain stable month-on-month, hovering at around $520-530/t cfr.
A source from a mill indicates that a substantial volume of plate imports is consistently entering Europe, with figures slightly below 200,000 tonnes/month. October and November demonstrated adequate performance in sales, albeit typically characterised by short lead times and limited quantities.
Natalia Capra France
Italian re-rollers plan production cuts, coils trend higher
Multiple Italian re-rollers and pipemakers are set to execute extended production halts throughout December. Two companies tell Kallanish of their decision to suspend operations for four weeks in order to align demand with supply. Current prices and margins are meanwhile considered unsustainable.
“The purchase cost of hot rolled coil has diverged from the selling prices of tubes. The repurchase of coil is not contributing positively to our operations, necessitating a reduction in production levels,” one tubemaker comments.
The implementation by the EU of robust protectionist measures has resulted in companies that previously sourced the majority of their HRC volumes from outside the EU facing a reduction in procurement options. This has also meant an increase in HRC prices. The conditions exist for European HRC to exceed €650/tonne ($685.29) base in the medium term, the source adds.
Downstream, re-rollers and service centres are experiencing notably low margins and financial losses attributed to the elevated costs of production and HRC. Re-rollers are anticipated to raise their prices in January as they adjust to the new market conditions, following extended production cuts and reduced availability.
“Should consumption fail to recover in 2025, numerous facilities in Europe may face closure,” another tubemaker says and adds that a discount of 48 points is not sustainable. This puts commodity tube prices at approximately €700/t ex-works.
Italian coil prices are slightly higher than they were at the start of the month. Conversely, downstream, prices for derivatives have remained stable. Cutting production significantly is also a way for re-rollers to reduce production costs.
European steel producers are currently discussing potential price increases for HRC in January. One major steel producer has informed buyers that, in January, it will request an increase of €20/t. In Italy, HRC is being contracted at an average of €555-560/t base ex-works, or €570/t delivered, stable on last week.
A producer plans to significantly reduce output this year to align demand and supply, and will temporarily halt operations at its plant for three weeks between December and January. The company will not take bookings for January and will exclusively accept orders for February due to the prolonged closure. Italian producers have largely completed their December order books.
The availability of material in Italy is expected to be limited due to the impending stoppages. Acciaierie d’Italia is currently operating at a diminished capacity. Italian HRC producers are aiming to increase their prices to €600/t delivered. However, customers remain sceptical about the feasibility of this target in the current market conditions.
One leading European producer is currently pricing HRC at €600-610/t base ex-works or delivered in various European markets. Current sales activity at these price points is virtually non-existent, but the absence of import alternatives leads sellers to believe this level will soon be reached (see Kallanish 28 November).
Natalia Capra France
Italian HRC mills prepare long stoppages, possible hikes
Italian hot rolled coil prices have maintained stability compared to mid-November, exhibiting a slight increase versus the beginning of the month. Demand is currently weak, and sales are being executed in restricted volumes.
Several Italian mills are set to undergo prolonged shutdowns in conjunction with the December holiday season. A producer plans to significantly reduce output this year to align demand and supply, and will temporarily halt operations at its plant for three weeks between December and January. The company will not take bookings for January and will exclusively accept orders for February due to the prolonged closure. Italian producers have largely completed their December order books, sources tell Kallanish.
The availability of materials in Italy is expected to be limited due to the impending shutdown. Acciaierie d’Italia is currently operating at a diminished capacity. Italian producers of hot-rolled coil are aiming to increase their prices to €600/t ($631/t) delivered. However, clients remain sceptical about the feasibility of this target in the current market conditions. Market participants, including both sellers and buyers, indicate a lack of interest in the import market, as import offers are primarily aligned with domestic HRC contract levels besides the risk of duties. A leading European producer is currently pricing HRC at €600-610/t base ex-works or delivered in various European markets. Current sales activity at these price points is virtually non-existent, but the absence of import alternatives leads sellers to believe that this price level will be reached in Europe.
In the coming weeks, it is expected that customers will ramp up their purchases in Italy in order to stockpile ahead of the impending closures, especially given that one producer will be unable to meet orders for January.
In Italy, service centre quality material is currently being contracted at an average price of €570/t delivered, with reports of some lower contracts around €550/t delivered. A significant number of service centres’ clients will start shutdown in the second week of December, with operations set to resume on 7 January.
Natalia Capra France
Acciaierie Venete buys distributor Euro Sider Scalo
Italian long steel producer Acciaierie Venete is buying local distributor Euro Sider Scalo, Kallanish learns from market sources.
Initially, the steelmaker will buy 60% of shares in the distributor through the creation of a new company. In time, Acciaierie Venete will increase its share to 100% through a call/put option, Italian competition body Autorità Garante Della Concorrenza E Del Mercato (AGCM) explains in a note.
Euro Sider Scalo is a distributor of high-quality special steel bars with different diameters and qualities. It supplies the mechanical, earth-moving machinery, industrial vehicles, automotive, oil & gas and hot-forging industries.
Natalia Capra France
Italian plate prices decline in stagnating market
Italian heavy plate prices are experiencing a downward trend, attributed to reduced domestic demand and competitive, low-cost import offers, Kallanish notes.
The market is quiet, according to mill and distributor sources. Order intake is persistently low. A mill source reports that sales in September and October registered a slight improvement compared to previous months; however, tight margins and inadequate profit continue to pose significant challenges.
Producers are quoting a lead time of about two weeks. Large customers continue to purchase in limited quantities. A small distributor claims he is buying also in small quantities, primarily from producers’ stocks.
According to one source, the EU imported approximately 180,000 tonnes of plate in October. This level has been the monthly average for the past six months. Local demand continues to be met by low-cost imports from Southeast Asia. However, buyers are reporting that Asian suppliers are now raising prices, meaning values of imported and local material are largely the same.
At present, domestic S275 grade plate is priced in the range of €590-610/tonne ($620-641), while S355 is at €620/t ex-works. Producers are asking for €650/t for 355 grade.
Current booking prices for Asian slab are flat on-month at around $520-530/t cfr Italy.
Natalia Capra France
Italian rebar activity stagnates with low prices
Italian rebar prices are mostly stable on-week although the low point of the range has decreased €10/t ($11) compared to the end of September, buyers tell Kallanish.
Last month, producers’ efforts to implement a price increase have not produced the desired effect, and activity is considered too slow to achieve the hikes.
Buyers and distributors anticipate a further price decline in the upcoming weeks, in line with scrap prices, also seen decreasing this month.
Current transaction values in the domestic market are at approximately €280-300/t base ex-works. Two buyers report purchasing limited volumes.
Including additional size extras at an average cost of €260/t, current values in Italy hover this week at €540-560/t ex-works.
The current price for domestic mesh stands at approximately €390-400/t, not accounting for transport costs. An extra fee of €300/t applies for size extras, sources suggest.
Natalia Capra France
Italian plate producers seek increases
Italian heavy plate producers are increasing prices by €30/tonne ($32) compared to last month for S275 and S355 grades. Sources tell Kallanish the market is quiet due to the sector’s August hiatus.
Local re-rollers are requesting €700/t ex-works for S275 grade and approximately €730-740/t for S355. Last month, they made significant efforts to lower their prices, resulting in import offers no longer being competitive.
According to a mill source, prices have hit rock bottom and are expected to rise in upcoming contracts. Given the current cost of production and imported slab values, it is evident that July contract prices are not sustainable for producers, as they are operating with minimal profit margins. Certain producers are starting to reject selling at the low levels seen in July.
During July, customers of all sizes showed a reluctance to make purchases, and sales volumes have been consistent but low. Various buyers took advantage of competitive import prices in June, resulting in a decline in local sales volumes. Last month, the cost of Asia-origin material was at around €600-620/t cfr Italy.
According to information from distributors, there is a continued stagnation in demand downstream. The current booking price for Asian slab is at approximately $550/t cfr Italy. However, for larger volumes, there are discussions about a slightly lower price of $540/t cfr. As of now, domestic S275 grade transactions are taking place at approximately €650-660/t ex-works in Italy. S355 is meanwhile being traded at around €680/t, sources suggest.
Natalia Capra France
