The local German rebar market has indicated sharp price increases after the New Year holiday due to lower spot stocks in the market and also increases in scrap prices and problems in scrap supply in Europe. Prices have increased by €130/mt to €650-680/mt ex-works since December. The target price is €700/mt ex-works in the market, but buyers are hesitating to buy even at current levels. The shortage of stocks is expected to end by the end of February and demand is not as high as was expected before the New Years holiday due to the second Covid-19 lockdown. Also, Germany wants to tighten its current measures and extend its lockdown at least until February 15. "We have low rebar stocks and also a shortage of scrap supply. But demand is also lower than we expected. The increasing price trend causes worries on both sides. Producers are worried because of the supply problems in scrap. They think they will buy scrap at higher prices. Supply problems in scrap are not only because of the cold weather like in previous years, but also because of the Covid-19 lockdown. They are worried because they are not sure if they can reflect this possible cost increase in their prices. On the other hand, buyers want to wait and they believe they can import rebar at better prices. End-user demand is not bad, but they expected booming demand in the new year and now they have to face a longer lockdown. They want to wait and observe the market as long as they can," a trader told SteelOrbis.
In the export market, prices have also increased, rising by €130/mt to €640-650/mt FOB. Prices are considered to be very high in target markets like Poland and Austria and demand for German rebar has remained low in export destinations.