The outlook for the European and Italian scrap market is that the ‘super euro’ will push the scrap market prices into a decline. Outlining his negative projections for the market Nuovo Campsider president Cesare Pasini gave his reasons as follows:
-After a month of November when we observed price increases between Euro 10 /mt and peaks of Euro 15/mt for some qualities of scrap, we are now convinced that we will see a drop in scrap prices. Thanks to the great strength of the Euro against the US Dollar, European exports of raw materials have seen a slowdown with scrap flow being redirected within the borders of the EU. This translates into availability of greater quantities. Added to this is the strengthening of imports, also thanks to the exchange rate. We have already seen an increase in deep sea scrap arrivals. We will see this to an even greater extent with ship arrivals in the months of January and February.
-In addition to the above, we must also consider the high level of scrap stocks and the imminence of end-of-year closures (for overhauling), which for some mills will be longer than predicted.
-In conclusion, we are expecting a period marked by the absence of tensions, especially during the winter closure. December won’t in itself provide causes that will depress prices but may reduce the projections of a drop triggered by the increased quantities of scrap that we see in our market.