The price drop for long products continues in southern Europe, especially in Italy, where everyone expects an increase that is not coming, creating a climate of general confusion in the market. In Greece, producers are waiting to assess the market and, meanwhile, import offers are rising.
In the local Italian market, the price of rebar has been at €430/mt ex-works base (€695/mt ex-works including regular extras) for small-volume orders and at €410/mt ex-works base (€675/mt ex-works including regular extras) for larger-volume orders. The price range thus marks a further decline of €40-50/mt on week-on-week basis. The price, delivery included, in northern Italy has been at €450-460/mt base DAP Northern Italy (€715-725/mt including regular extras).
Slight declines were also seen for wire rod SAE1006, which is now at €680-690/mt DAP northern Italy, compared to €690-700/mt DAP northern Italy last week, while mesh quality stood at €650-660/mt DAP northern Italy.
The expected increases have therefore been delayed and this is causing confusion. "Local demand is not absent," commented one Italian producer, adding, "The problem is that everyone is waiting for an increase, but there isn't one, and in these conditions, customers are buying little by little."
As for export offers, Italy is offering rebar by truck at around €640-650/mt ex-works, up slightly from last week when it did not exceed €640/mt ex-works. The FOB export price of Italian steel mills remains stable at €670/mt, but customers do not seem to be accepting more than €635-640/mt FOB, according to sources.
"As a steel mill, cautious behavior is the optimal choice, at the cost of selling less," commented one Italian producer on the request for further discounts, going on to say, "In spring, I hope demand will increase, as early as March, when the government will remove aid to companies for energy costs, and the earthquake situation in Turkey will influence the raw materials market."
Greek producers, on the other hand, are waiting to understand the direction of the market, but sources said their export offers for long products are unlikely to be below €680-685/mt FOB. Spanish mills as well, according to sources, have increased their offers, which are now at €680-700/mt FOB for rebar and about €700-720/mt FOB for wire rod.
Import offers from North Africa are increasing. Egypt is offering rebar at $700-720/mt FOB and wire rod at $700-730/mt FOB (+$30-50/mt week on week), which translates to about €688-707/mt CFR and €688-717/mt CFR, respectively.
Offers from Algeria have this week been at $730/mt FOB for rebar and $750/mt FOB for wire rod (+$60/mt week on week), which means about €717/mt CFR and €736/mt CFR, respectively.