After the declines recorded in the previous week, prices in the Italian flat steel market have remained virtually unchanged in the past week. Accordingly, hot rolled coils (HRC) are offered at €480-490/mt ($586-598/mt), cold rolled coils (CRC) are at around €550-560/mt ($671-683/mt), while hot dip galvanized (HDG) coil prices are standing at €530-535/mt ($647-653/mt), all ex-works.
The summer stoppages are imminent and the market players consulted by SteelOrbis tend to exclude price changes in the Italian flat steel market between now and the end of August. It appears that the base prices for coils have finally reached the bottom: if further declines happen, they will be just minor corrections at most.
Meanwhile, the situation remains as seen in recent weeks: flat steel demand is very low and producers are working on just-in-time basis. Mills report that their stocks are at low levels, while they have recorded a very low number of orders for the month of September. Finally, SteelOrbis has learned that several service centers have offered prices lower than the average in order to increase their liquidity.
With regard to domestic production, according to the latest official figures for the month of May Italian flat steel output fell by one percent year on year, while domestic output of crude steel in May registered an increase of 3.3 percent. Since Italian crude steel production fell by 7.9 percent year on year in June, it is likely that the domestic flat steel output in that month (for which figures are not yet available) will see a sharper drop than in the previous month. Indeed, Taranto-based Ilva previously announced the shutdown of some facilities from June 10.
As usual, there have been no significant movements in the import market, where purchases possibilities remain very limited, also because of the euro/dollar exchange ratio. The situation, from this point of view, continues to favor domestic manufacturers, which offer much more competitive prices compared with foreign offer levels.
€1 = $ 1.22