The European longs steel market is still struggling at the end of the summer holidays. Demand for finished steel products is on the low side and mills have reported difficulties in concluding their sales portfolios for September amid sluggish local and international market conditions.
While the Italian rebar market had experienced significant price rises before the summer holidays, suppliers are now struggling to maintain those levels, especially in the northern and central parts of Italy. In southern Italy, on the other hand, finished steel demand and prices seem to have found a good balance. Officially, Italian rebar prices have been reported at €300/mt ex-works base (€565/mt ex-works including regular extras), but some market sources have also reported prices as low as €280/mt ex-works base (€545/mt ex-works including regular extras). End-users of rebar had bought significant volumes during the previous round of hikes in late July-early August, and now they are in no rush to buy, which means that some further declines are likely in the short term.
In the wire rod segment in Italy, August levels had consolidated at €600-615/mt delivered for drawing quality wire rod and at €580-595/mt delivered for mesh quality wire rod, but the forecast for September sees a drop of around €5/mt - at least for the former grade - compared to these levels. Moreover, a major steel mill has reported difficulties in completing its sales for the current month as demand has slackened.
In central and eastern Europe, as well as in Germany, drawing quality wire rod prices in August had consolidated at €600-615/mt delivered and €620-640/mt delivered, respectively, whereas mesh quality wire rod prices had consolidated at €580-595/mt delivered and €580-590/mt delivered, respectively. September forecasts, however, see a drop in the range of €10-20/mt compared to these levels. New levels, however, have not yet been confirmed. It is also worth noting that one of the major mills in Poland has recently decreased its sales prices for long products by €15/mt, citing the weak market response.
As for exports, ex-Italy rebar prices have been reported at €540-550/mt FOB, in line with local prices, and ex-Spain rebar prices to UK ports have been reported at €540/mt FOB.
In the import market, Turkish rebar and wire rod prices have been reported at €485-495/mt CFR and €495-500/mt CFR, respectively, marking a decline of €5/mt compared to one month ago. Lastly, rebar and wire rod prices from Egypt have been reported at €490-495/mt CFR and €500-505/mt CFR, respectively. The first price marks a decline by €5/mt on the higher end of the range compared to one month ago, whereas the second price marks the same decline on both ends compared to the same period. These prices are based on the euro-dollar exchange rate of 1.17 (European Central Bank, September 3).