The Italian beams market continues to be characterized by a price increase trend. The strong levels of demand compared to supply, together with the higher prices of scrap and other raw materials, have resulted in the consistent increases seen in Italy's beams prices in the first two months of 2008, and also appear likely to push prices higher still in the days to come.
Currently, the predominant aspect of the market seems to be the very strong demand coming from customers. This trend is evident in particular across the continent of Europe, where high levels of demand are observed in France, Germany, in the countries of Central Europe and in the countries bordering the Mediterranean. The major preoccupation of traders in Italy at the present time is to buy in sufficient quantities of material and to fill any gaps in their inventory.
As regards the distribution system, so far the traders and the service centers have not been able to pass on the increases which they paid to the mills, and so have been suffering from a temporary contraction of their margins. In addition, distributors report that if further substantial increases are seen, customers may begin to experience solvency problems - especially those doing contract work at prices fixed in previous months.
Looking to the months ahead, the market is expecting further price rises from the producers. The mills could initially raise their base quotations, and then later hike their quality extras. This latter option, however, is currently only being studied.