Southern European rebar market remains quiet, while exports lose currency advantage

Demand in the Italian domestic rebar market has continued to remain low this week, with buyers only purchasing in limited quantities. Domestic price levels, in the meantime, have remained at last week's levels at €520-530/mt ex-works.
 
Export offers by Italian producers have dropped by about €5/mt compared to last week to €515/mt FOB on actual weight basis, due to the lesser  number of inquiries based on the trend of the euro/dollar exchange rate. Even though offers below this level are heard in the market, buyers are reported to prefer to remain in wait-and-see mode.
 
There are ex-Italy offers heard to be given to Algeria at €550/mt CFR basis; however, following the bookings concluded 15-20 days ago, buyers are comfortable with their inventory levels and are not in a hurry to book new material for now. 
 
In the domestic Spanish market, rebar prices have softened by about €5/mt this week, dropping back to €550-560/mt delivered to customer, on actual weight basis. Demand for rebars in Spain remains quiet. Spanish producers' export offers continue to remain at €515-520/mt FOB; however, the volume of inquiries has declined as the Turkish and CIS rebar producers have gained some advantage due to the strengthening of the euro against the dollar.
 
In the Portugese market, demand is observed to be very weak. In parallel to the softening scrap prices, Spanish producers have cut offers for 60-day deferred payment by €5/mt to €570-580/mt delivered to customer, on actual weight basis.
 
 In Greece, the debt crisis continues to depress the market where demand for rebar is very low, though prices are stable. Medium-size rebar prices for 30-day payment terms on actual weight basis stand at €540-580/mt delivered to customer, on actual weight basis. The market outlook has not been positive lately, and no immediate recovery is expected in the Greek rebar market yet.
 
In Bulgarian domestic market, demand for rebar is storng contrary to other southern European markets. Domestic rebar price levels have remained unchanged over the past week at BGN 1,090-1,100/mt CPT, excluding VAT. However, SteelOrbis understands from the market that these price levels may be subject to a downward revision in view of the downtrend in the international rebar markets.
 
With the euro/dollar exchange rate approaching 1.37 levels, southern European rebar producers are losing their price advantage in the export markets. The focus is now on the European rebar producers, on whether they will make another downward revision on their price levels in view of the weak domestic demand as well as the silent export markets.