Italian merchant bar demand still stagnant

Despite the return from the summer holidays, the Italian domestic merchant bar market has remained lackluster in terms of activity. Demand from traders and end-users continues to be stagnant, and all market operators want to keep their inventories as low as possible in order to avoid risks. In this context, competition among local merchant bar producers is heating up.
 
As regards merchant bar prices in the domestic Italian market, currently base prices stand at €220-230/mt ($304-317/mt) ex-works, essentially unchanged since July. As scrap and billet quotations have stayed at relatively high levels and as steel mills are already facing narrow profit margins, merchant bar prices are not expected to decrease in the near future. On the contrary, local producers will try to push up prices, although the market does not seem to be able to absorb any rise in quotations for the time being. The only support in this regard could come from some restocking activities by traders, whose inventories have been kept at low levels in recent weeks.