European longs prices have increased this week in official requests, although deals continued to be closed at previous levels due to a lack of demand. The upward pressure, in fact, is not generated by an actual recovery in market fundamentals, but rather by speculation on CBAM and by the gradual exhaustion of import quotas.
In the local rebar market in Italy, some producers’ requests have gone up to €310-320/mt ex-works base (€570-580/mt ex-works including regular extras), i.e., increasing by about €20/mt compared to previous levels, but, according to various sources, the same producers are still accepting orders at last week’s levels, i.e., at €290-300/mt ex-works base (€550-560/mt ex-works including regular extras), and in some cases even at €270-280/mt ex-works base (€530-540/mt ex-works including regular extras). When interviewed about the success of new requests in the market, a source at an Italian mill replied, "I believe that the market will have to adapt. Everything is going up, and rebar will follow the trend." A source at another producer, on the other hand, believes that these levels will not work, adding, "Demand is lower than supply and customers still have full warehouses, because they had stocked up fearing an increase at the beginning of the year". "However," he went on to say, "current prices are too low, and it will be necessary to monitor increases in scrap prices."
In the rest of Europe, long steel producers are also asking for price increases in the range of €15-20/mt, but in these cases it seems that new levels may be accepted by the market. A Polish manufacturer announced that, starting from the current week, they would increase their product prices by up to €50/mt, although, according to some sources, this is only a speculative attempt.
It is also worth mentioning that the logistical problems that had emerged in past months are continuing to weigh on European markets, particularly Italy and Germany, and market players are not confident that the situation will improve soon.
As for the wire rod market, local prices in Italy have remained unchanged at the same levels observed last week, but it is likely that the upward pressure in other segments will also lead to price increases for this product. At the moment, however, wire rod prices in Italy remain stable at €565-590/mt delivered for mesh quality and at €585-620/mt delivered for drawing quality.
According to some sources, Italian producers’ prices for exports are standing at around €560/mt FOB for rebar and around €570/mt FOB for wire rod. However, the former is estimated based on average values observed in the market, while the latter represents a "virtual" price, since, according to a source, there are no Italian producers with enough material available to be exported by ship. On the other hand, prices for exports from Greece have been reported at around €570/mt FOB for rebar and €580-600/mt FOB for wire rod, "but we are considering further increases", a source at a Greek producer said. Finally, rebar prices from Spain to UK ports have been reported at around €580/mt FOB, unchanged week on week.
In the import market, rebar from Turkey has been reported at €510-520/mt CFR and wire rod at €520-530/mt CFR, stable overall week on week. Egypt has asked for €500-505/mt CFR for rebar and about €510/mt CFR for wire rod. Finally, Algeria is offering at around €500/mt CFR for rebar and €505/mt CFR for wire rod. However, one market player said it will be "increasingly difficult to import rebar into Europe, considering the current regulations [CBAM and quotas]".