In May, the Italian flat steel market was characterized by livelier activity in the middle of the month, while both the initial and final parts of the month were a lot quieter in terms of activity. According to market sources, in recent days there has been a more uncertain atmosphere in the market due both to the difficult situation concerning the largest Italian steel producer Ilva and also due to the absence of strong price trends internationally.
Despite attempts to increase prices by local producers, no one is betting on a rise in prices in the medium term, as the need to sell continues to put pressure on prices. At the same time, no significant reductions are expected in prices. Throughout the supply chain, margins have been cut to the bone. As a result, according to sources, producers may still try to increase their prices up to the beginning of the summer holidays in Europe, hoping for support from a sufficiently lively market.
Meanwhile, flat steel supplies are low both at producers and at service centers, due to price volatility and liquidity tightness. However, as for the coming period, sources believe that it will be possible to see an increase in imports from non-EU countries, especially with regard to hot rolled coil (HRC). Faced with uncertainties relating to the Taranto-based Italian producer Ilva, some large buyers might decide to buy from foreign countries, putting aside evaluations of price convenience in favor of much greater certainty as to the regularity of flows of incoming material.
Sources polled by SteelOrbis continue to hope for the implementation of interventions by the Italian government which would make a positive contribution to the economic development of the country. When a genuine economic recovery is eventually perceived, prices will be able to rise significantly and delivery periods will be extended.
Currently, Italian domestic producers' base prices are at €410-420/mt ($558-571/mt) for hot rolled coils (HRC), €490-495 ($666-673/mt) for cold rolled coils (CRC) and €460-475/mt ($626-646/mt) for hot dip galvanized (HDG) coils, all ex-works.
€1 = $1,36