During the last seven days, Italian long steel producers have already almost halted their production activity, although official stops will mainly begin next week. In any case, output has already been strongly reduced and steelmakers are now selling only products from their stocks, trying to increase their revenues as much as possible as they have been trying to do in the last few weeks.
Neverthless, the demand level is unsatisfactory and does not allow any strong increases in prices. Producers' rebar prices are in the range of €495-505/mt ($609-621/mt) ex-works for 14-26 mm material, but due to low supplies the mills may ask up to €515/mt ($633/mt) for certain diameters although they have little possibility of concluding sales at this price level. Actual transactions are scarce because most buyers previously completed purchases in the range of €490-495/mt ($603-609/mt).
On the export side, demand is lackluster due to Ramadan and the recent fluctuations of the euro/dollar exchange rate. Having dropped below 1.21 early last week, the exchange rate has now reached 1.23: for North African buyers this means paying around $10/mt more, leading them to delay their bookings. At present, there are no ex-Italy offers, while rebar producers are said to be targeting the €495-500/mt ($609-615/mt) FOB price level for September deliveries if the exchange rate permits. Anyway, the outlook is quite positive as SteelOrbis sources state that Algerian and North African stockists will return on the market as soon as early September even though their stocks are currently at high levels.
€1 = $ 1.23