According to Antonio Marcegaglia, CEO of Italian steel manufacturing group Marcegaglia, ex-Europe hot rolled coil prices are likely to fall in the last quarter of this year, before rebounding in the first quarter of next year supported by costs, especially high iron ore prices.
Hot rolled coil prices are likely to fal
l to $640-650/mt FOB Europe in the fourth quarter and then climb to around $700 FOB in the first quarter next year, Mr. Marcegaglia told Reuters.
Hot rolled coil prices have been at about $680-700/mt FOB Europe this month.
"Some think raw material prices will fall significantly in the next few months, but I am sceptical; I don't think prices will fall so much, so rapidly," he said. "Unless raw materials prices fall dramatically, steel prices should rebound in 2012," he added.
"The worsening economic climate is having a negative impact on the steel market, and, in developed countries in particular, this may lead to further production cuts," he said, adding, "If demand does not pick up in Europe, there will certainly be adjustment in capacity."
"If steel mills cut capacity to respond to lower demand, their production costs will rise by about $50/mt and this will support prices further," Marcegaglia said.