Italian flats producers raise prices as demand picks up

Thursday, 03 September 2009 17:32:39 (GMT+3)   |  
       

Following the price increase trend which started in the local Italian flats market in early August, further price increases were made by Italian producers in the last week of the same month.

The destocking process in Italy's flats market has definitely come to an end and buyers have now resumed their purchasing activities. Current orders are for October/November deliveries. In the meantime, plants are stepping up their production levels.

As regards prices, HRC base prices are at €410-430/mt, with CRC and HDG in the range of €470-480/mt ex-mill. Only very narrow margins of negotiation are allowed, depending on customers and tonnages.

Other hikes are expected from local producers soon, likely to be in the range of €30-50/mt depending on the products.

Turning to import offers, at present China is offering at €420-425/mt CIF, including extras, for late December deliveries. No offers have been heard from Egypt, India and Turkey.

As for the future, there are two important factors. The first of these is the hike in production levels. The real impact of this increased production will only be seen at the end of the year, since most current demand is based on restocking activities rather than on real consumption. The second factor is the approach adopted by producers; with the price increases they have already made (about €120/mt up from their minimum levels), the producers are now starting to see a certain profit margin.


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