The European steel market entered July 2025 under heavy pressure, continuing the sluggish trend observed in June. According to the latest monthly report from Assofermet Acciai (the steel division of Assofermet, the association representing Italian distributors of scrap, raw materials, and steel products), persistent macroeconomic and political challenges -particularly the slowdown in China, geopolitical conflicts, and US trade protectionism - are restraining demand recovery.
Weak demand and pricing strategies intensify
In the carbon flat steel segment, European service centers face stiff competition from Far Eastern producers. To stay competitive, local mills are cutting prices in hopes of sparking renewed buying activity.
Some market participants, however, see a faint possibility of improvement. They point to a potential technical rebound from price lows in the coming weeks, supported by two key factors:
- The Carbon Border Adjustment Mechanism (CBAM) coming into force.
- Rising production costs leading to unsustainable margins for producers.
The stainless flat steel segment remained weak, closing June with underwhelming volumes and further price declines. Meanwhile, the scrap market also experienced price erosion as mills scaled back production. In the spot market, uncertainty reigned; June volumes fell compared to May but remained stable year on year. Product performance diverged across categories: while tubes and carbon plate showed signs of recovery, stainless steel remained weak. In the longs segment, the recovery in beams helped offset the decline in merchant bars, resulting in an overall balanced performance.
Global factors and import trends
Market sentiment remains cautious, shaped by international events:
- Ongoing conflicts in key regions
- Potential easing of EU-US trade tensions anticipated in early July
These dynamics could influence the steel market trajectory in the second half of 2025.
Additionally, in the tinplate segment the pre-summer period saw a surge in import purchases driven by fears of CBAM-related disruptions. This resulted in increased availability of European material and further domestic price softening.
Assofermet notes a significant overrun in safeguard quotas for India and Turkey, leaving tens of thousands of tons stranded at port terminals for months.