Quotations for flat products are currently seeing an upward trend in the Italian market. Indeed, all steel producers – be they Italian, EU or non-EU – are now seeking increases for second trimester deliveries.
In the Italian market, the increases being sought by the mills have mostly impacted on hot rolled, while cold rolled and hot dip galvanized have been less affected, even if the prices of the latter two products still appear to be evolving. One service center indicated that in response to these increases there has been a certain reduction in offers from non-EU countries. This rising trend of quotations is also having repercussions on the sales prices of the service centers which are now also moving upwards.
With regard to demand, the service centers are seeing fairly good levels, while retail warehouses are registering good volumes. For the weeks ahead, most market players interviewed expect a continuation of the trend begun in recent days, with the consolidation of the sought-after increases and further upward movements.
A survey of Italian service centers indicates a rise in sales figures during the month of January. In the first month of the year, 83 percent of service centers surveyed said they had seen a rise in sales compared to the month of December. Meanwhile, compared to the sales levels for January 2006, 50 percent of service centers surveyed stated that their sales for January 2007 were higher, 33 percent said there was no difference, while 17 percent said their sales had seen a drop. Expectations for February are tending towards optimism, with 58 percent of respondents expecting an increase in their sales volume.
The situation as regards inventory levels is somewhat different. After the process of rebuilding stocks in the second half of 2006, in January the levels of inventory had increased for 25 percent of service centers questioned, were constant for 42 percent, but had dropped for 33 percent. The expectations for February are for a rise of stocks in 17 percent of cases, for no change in 42 percent of cases, and for a downturn according to 41 percent. While January price levels oscillated between stability and decline, greater optimism prevails among Italian service centers for the month of February.