Currently, domestic producers' base prices in Italy are at €410-420/mt ($476-487/mt) for hot rolled coils (HRC), €480/mt ($557/mt) for cold rolled coils (CRC) and at €460-470/mt ($534-545/mt) for hot dip galvanized (HDG) coils, all ex-works.
Italian and European producers, driven by the need to raise prices from the very low levels seen at the end of 2014, announced price increases of between €10/mt ($12/mt) and €25/mt ($29/mt) upon their return from the holidays. However, sources detect the presence of headwinds from third countries which are already giving offers €20-25/mt ($23-29/mt) lower compared to the prices that European steel producers would like to consolidate. In this situation, consumers appear very cautious and are seeking to postpone any purchases, even though Italian flat steel demand in general has shown a slight improvement compared to the end of 2014, when demand had declined more than expected.
Meanwhile, the Italian steel industry has been influenced by developments in the case of domestic steelmaker Ilva. On Wednesday, January 21, Italian industry development minister Federica Guidi named Piero Gnudi, Corrado Carrubba and Enrico Laghi as extraordinary commissioners for the troubled steel plant based in Taranto. The appointments will be effective with an upcoming decree putting Ilva under extraordinary administration. In this context, lots of flat steel consumers are taking into consideration alternative sources of supply. According to market sources interviewed by SteelOrbis, in the coming period an increase in the volume of imports is expected. Such an increase will be restrained a little only by the fact that not every buyer is able to obtain credit within a short period. According to the same sources, it is possible that, in the absence of specific positive developments, the recent price increases will not stick in the short-to-medium term, especially if import offers become even more competitive.
€1 = $1.16