The Italian scrap and raw materials market recorded a downward trend in September, while the market mood has remained weak and uncertain, according to the latest monthly scrap market report published by Assofermet, the association representing Italian scrap distributors.
The association has reported low scrap demand from steel producers, while the availability of the raw material remains scarce - especially for higher grades - but was still sufficient to cover mills’ needs. Assofermet has observed scrap purchase prices dropping by a range of €5-20/mt, commenting, "It is now clearer that mills, having to face high energy costs and increasing environmental restrictions, consider it more convenient to purchase semi-finished steel from non-EU countries." Demand for finished steel in Italy remains weak and the euro-dollar exchange rate is unfavorable for exports. The sentiment for October is pessimistic, the association reports, and it is marked by uncertainties concerning the new European regulations and the current geopolitical scenario.
According to Assofermet’s report, September was also sluggish in the international scrap markets. However, Turkey saw a rebound in import scrap prices of about $10/mt during the past week. In other European markets, on the other hand, scrap prices in September fell by around €5-10/mt. However, the scenario for the coming weeks is characterized by the absence of Asian markets due to their holidays and by a possible decline in scrap prices in the United States by about $10-20/mt, caused by a drop of finished steel demand.
The market trend in the stainless steel scrap segment was different and prices remained essentially unchanged with a slight upward push towards the end of September. According to Assofermet, this was due to a gradual shortage of stainless steel scrap availabilty. Demand, on the other hand, remained low in Italy and average in the rest of Europe, while the euro-dollar exchange rate limited exports once again. "The European macroeconomic picture (high interest rates [from] the European Central Bank and ongoing trade tensions between the US and the EU) continues to weigh on sentiment, imposing caution and limiting market predictability," the note says.
As for pig iron, its availability is reported to be good from various origins, but Italian steel mills are not showing any particular interest. Assofermet has reported unchanged or slightly lower prices, in particular from exporters in Russia, Ukraine and Brazil, but no new purchases have been recorded from either Turkey or the United States. Demand for hematite pig iron increased slightly, but it was mainly aimed at restocking. The overall scenario remains substantially firm and characterized by strong uncertainties due to the US-EU tariffs. Finally, the ductile iron segment recorded a price drop due to the "difficulties of end-consumers", who have to cope with issues such as energy prices, the German economic crisis and Chinese overcapacity
In the ferroalloys segment, Assofermet reported a drop in ferromanganese and ferrosilicon prices. Ferrochrome prices, on the other hand, remained stable.