No big news, either positive or negative, regarding the flat steel prices in the Italian market. The risk that producers could surrender to a decline of prices has disappeared, letting producers to aim at defending their profit margins as much as possible- which are already narrowed by relatively high production costs - and avoiding the risk of price drops ahead of the holiday period. On the other hand, flat steel demand coming from downstream industries has slowed down, and this has resulted in a contraction of steel service centers' supply activity, as their restocking volume has remained below expectations for this period. Indeed, Italian service centers' inventories are relatively low, indicating that uncertainty continues to spread among market players.
In the local Italian market, flat steel prices have remained almost unchanged compared to June. Base prices for hot rolled coils (HRC) stand at €520-530/mt ($749-763/mt), while cold rolled coils (CRC) and hot dip galvanized (HDG) are at €610-620/mt ($878-893/mt) and $560-570/mt ($806-821/mt) respectively, all ex-works and exclusive of VAT.
On the import side, in recent weeks there have been several flat steel arrivals in Italian ports. However, suppliers' offers via local traders, are quite aligned with the Italian domestic prices and therefore there is no particular pressure on domestic prices exerted by import offers. However, it remains to be seen whether the import offers will stay in line with local quotations in the near future, or - especially in consideration of the weakening in the ex-US scrap for Turkey and the slowdown of the Chinese market - will follow a bearish trend.
In conclusion, market operators do not forecast any significant price movement before the summer holidays, while medium-term predictions suggest that in the remainder of this year demand will hardly soar.