Slow restart in Italian long steel market, pricing bullish

Friday, 13 January 2023 17:58:09 (GMT+3)   |   Brescia
       

Activity is resuming, albeit slowly, in the long products market in Italy after the Christmas vacations. Before the break, some producers had tried to raise prices and so they could afford a restart at a higher level in January. Demand for EU origin long products in the export markets seems to be lagging, while there is an overall optimistic sentiment in the local market, at least for now.   

"We resumed [operations] without a large order book," said an Italian producer. "We have started selling and there is demand, although it is not exceptional. Buyers are afraid to buy more than they need, but in the first few days there were some sales. Now it is our turn to get moving," he added.

2023 seems to have gotten off to a good start in the local market. Energy costs are back to what they were before the war, and some sources describe a better-than-expected situation. "We expect a year with lower margins, but with reasonable volumes. It will be a good one: the prospects are there,” a producer stated.

Italian producers, who have resumed their operations after the holiday, are now offering rebar at €580/mt ex-works base (€845/mt ex-works including regular extras). This price rose by €50-60/t from mid-December, but it is almost in line with the level a couple of producers had tried just before Christmas, which was at €585-600/ton ex-works base. In the wire rod segment, there is no single firm price range reported in the Italian market. While some sources say official offers for SAE1006 grade are at a minimum of €740/mt DAP northern Italy (up €20-40/mt over the past two weeks), while other market players evaluate the workable levels for the product at not higher than €680-700/mt DAP. The price situation in the segment is to gain clarity next week, sources expect.  

In Europe, some have, meanwhile, tried to increase export prices, but deals are being made only for small volumes. Prices from Italy have been standing this week at €650-700/mt FOB for wire rod and €670/ton FOB for rebar. The latter, according to one source, could rise as high as €700/mt FOB in the coming weeks. Spain, on the other hand, is offering rebar at €680/mt FOB and Greece at €690/mt FOB.

In the import segment in the EU longs market, ex-Asia offers have been reported at $700/mt CFR, up $10-15/mt over the past week. Most Egyptian wire rod offers have been standing at $670-680/mt FOB or around $710-720/mt CFR, while one of the Algerian mills has offered $690/mt FOB, which is equivalent to around $720-730/mt CFR for medium-sized lots. 


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