European long steel market stable as buyers return; mills eye higher prices
The European domestic long steel market remained largely steady Feb. 19, as mills continued their attempts to raise prices on higher production costs, while demand showed early signs of improvement.
“When you’re at rock bottom, buyers start placing orders,” said a mill source, noting that while activity had increased in the past 10 days, large-volume transactions remained scarce. Market participants remained in a “wait-and-see” mode, with expectations that real demand would pick up in March.
A trader reported rebar prices in Northwest Europe in the range of Eur625-630/mt delivered Benelux, slightly higher than previous levels, as buyers slowly returned to the market. A mill source confirmed tradable values for rebar at Eur560-570/mt FCA Northwest Europe.
In Southern Europe, the Italian rebar market remained weak despite efforts to raise prices. A distributor reported tradable values at Eur590-595/mt ex-works Italy, while a producer noted that demand remained subdued. Rising raw material costs, particularly for scrap, were expected to exert further upward pressure on prices by late February or early March.
The medium sections market followed a similar pattern, with tradable values reported at Eur735-745/mt ex-works Italy. A distributor reported tradable values for Category 1 sections at Eur790-810/mt delivered Italy. Despite seasonal slowdowns, sources anticipated price increases due to higher production costs, though actual demand remained average.
Concerns over the impact of potential US trade policy shifts and the EU’s Carbon Border Adjustment Mechanism continued to circulate. However, sources downplayed the immediate effects, as EU exports to the US remain limited.
Platts assessed rebar at Eur600/mt ex-works Northwest Europe, stable over the week, while medium sections were assessed at Eur790/mt delivered, also stable over the week.
Italian longs prices flatten
The Italian long steel market is still in a stable state, with no change in prices since January, Kallanish notes.
Over the last two weeks, some niche sectors have placed orders, but sales of longs and flats are generally still limited to a few truckloads. Buyers are exhibiting caution and are resisting any upward price adjustments.
One merchant bar producer has halted sales and is anticipated to raise prices by approximately €20/tonne ($20.9). The decision is being driven by the unsustainable nature of current pricing, particularly in light of higher energy costs and scrap values. The current price range for domestic merchant bar is around €690-700/t delivered, which includes size extras.
Demand for sections remains quiet. In comparison to last month, there is an increase in contract prices of €10/t. Sources indicate the first category of beams is priced at around €800/t delivered for smaller orders. Further price increases are expected in Europe.
Natalia Capra France
Northern European long steel market inhibited by weak demand from construction sector
But high energy prices mean mills in the region maintained their offer prices from the previous week, Fastmarkets understands.
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Northern Europe, was €625-645 ($651-672) per tonne on Wednesday, widening week on week down by €15 per tonne from €640-645 per tonne on January 15.
Price increases established before the Christmas holidays have been maintained despite the weak demand, mainly because of ongoing high feedstock costs, sources said.
“These is ongoing poor demand, but we have had some inquiries and some [questions] about prices [and we] still have some running orders from last week,” one buyer source told Fastmarkets.
Deals were reported at around €625 per tonne while offers were reported at €635-645 per tonne. It remained unclear if the market would accept these higher offers.
“Energy costs are around 25% higher than they were last year, which is a big problem for the steel mills, especially with low demand,” the buyer source told Fastmarkets.
Sources in the Netherlands said they expected construction projects to pick up again in Spring, which could, in turn, stimulate buying activity.
“The government is talking about new construction projects being commissioned,” a trader source from the Netherlands said. “If it is true, we will see. Sentiment is better now we have a new government, that says it will prioritise building over environmental priorities.”
Import offers for rebar into Northern Europe were scarce due to weak demand and uncompetitive prices, sources said.
Scrap prices edged slightly higher, meanwhile, amid improved demand from Turkish mills for February deliveries due to improving steel sales in the country, sources told Fastmarkets.
Fastmarkets’ calculation of its daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was $334.58 per tonne on Wednesday, up from $332.34 per tonne week on week but down from $348.12 per tonne month on month.
Fastmarkets’ corresponding weekly price assessment for steel wire rod (mesh quality), domestic, delivered Northern Europe, was unchanged at €610-620 per tonne.
Wire rod import offers were reported at €590 per tonne for May delivery, but the appetite for imports was muted amid ongoing uncertainty regarding the current EU safeguard review.
“The last review from June 2024, which came into effect on July 1, 2024, caught a lot of [market participants] by surprise, so there is some risk aversion [now],” a wire rod producer source said.
Bleak outlook
The outlook for the European steel market remains bleak due to ongoing weak demand and negative growth in the region, combined with increasingly protectionist measures elsewhere, the International Rebar Producers and Exporters Association (IREPAS) said in its latest short-range outlook, published on January 15.
According to IREPAS, the EU is expected to announce a revision of protective measures on April 1.
Excess capacity from China has continued to put downward pressure on prices and, with increasing moves towards protectionism, heralded by the US, the short- or medium-term outlook was bleak, both in terms of prices or demand, the association said.
ArcelorMittal increases longs prices in Europe
ArcelorMittal is increasing its prices for long products throughout Europe by €25/tonne ($25.6/t), Kallanish hears from market sources.
The decision was driven by rising energy costs, which are making current longs prices unsustainable. The steelmaker is implementing a price hike across all commodity grade long products, which encompasses rebar, mesh, sections, and both low- and high-carbon wire rod. This is effective immediately for all new orders.
Energy costs are projected to continue rising, significantly affecting the profitability of European mills. Energy tariff increases have been substantial since October 2024. In Germany, power prices have surged by up to 41% compared to October, while gas prices across Europe saw an average increase of 22%. Gas and electricity forward prices are also high. According to the Dutch TTF gas index, prices went up from €40/MWh on 18 October to €48.2/MWh on 13 January.
In numerous European markets, several steelmakers are raising prices of wire rod, sections, and rebar. The market, however, remains sluggish, with transactions primarily occurring only for low tonnages. Market participants are being prudent in light of the uncertain conditions in the construction industry, especially within France and Germany.
Despite the general market weakness, a large northern EU steelmaker sees “surprisingly improved demand” for some longs, particularly sections. This is alongside an increase in enquiries for rebar.
Natalia Capra France
Northern Europe long steel prices steady despite Eurofer’s stark warning on survival of EU steel sector
In the week to November 22, mills attempted price rises in the rebar market; but buyers have so far resisted and somre mills are likely to begin cutting production in a bid to rebalance supply-demand dynamics, sources told Fastmarkets.
But European steel association Eurofer issued a statement on Wednesday highlighting the importance of committing to the green transition to save the industry from irreversible decline and calling for urgent action to be taken the EU and its member states, to avoid the steel and manufacturing sectors becoming obsolete.
But Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Northern Europe, was unchanged at €610-620 ($642-653) per tonne on Wednesday.
Rebar producers were targeting price rises of around €50 per tonne in the week to November 28, but there has been no interest, sources said.
“Offer prices have gone up considerably, with domestic mills asking for up to €50 per tonne or even more, but these prices have not yet been accepted by the market,” a trader source said.
“But there is a very good chance they will be [accepted] in January, when we are back [after the end-of-year] holidays. And some mills will initiate production stoppages for a longer than normal during the coming holidays to get demand in balance with production,” the source added.
And halting production could put upward pressure on prices, Fastmarkets understands.
International scrap prices have fallen as a result of slow steel sales, sources said, and Fastmarkets’ calculation of its daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was $336.95 per tonne on Wednesday – down from $343.01 per tonne on November 20 and down from $360.32 per tonne month on month.
Turkey only booked half the cargoes it would normally, Fastmarkets understands, because slow steel sales mean inventories have been building up and with the end of year fast approaching that is unlikely to change, so production has reduced and less scrap is required.
Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Northern Europe, was also unchanged at €600-610 per tonne.
Stark warning
In its statement on Wednesday, Eurofer said that without definitive action, further production cuts, plant closures and a worsening downturn would be the inevitable consequence.
“How many more plant closures, job losses, and stalled decarbonisation projects will it take before the EU and [its] member states wake up? Europe’s de-industrialisation is accelerating, with steel, automotive, renewables and batteries all on the brink,” Eurofer director general Axel Eggert said.
“We urge the new European Commission and EU governments to stop this bloodshed and adopt swift measures on trade, [the carbon border adjustment mechanism], energy and steel scrap, while working on a structural solution to preserve our industry’s competitiveness,” he added.
