Italian scrap market weak amid stable prices and downward pressure from mills

If the key word among market participants was "uncertainty" until mid-June, weakness has taken its place for a couple of weeks now. A general sluggishness is characterizing the Italian and also the general European scrap market, and many players are already unusually absent due to the summer holidays.

Although Italian scrap dealers have reported some deals closed at unchanged or slightly lower levels, specifically dropping by €5-10/mt in spot contracts, scrap volumes required by mills continue to be very low, as well as scrap availability. "Just to give an idea of the situation we are experiencing, the amount of busheling scrap we collect from [suppliers] has fallen by 87 percent from 1993 to 2023," an Italian scrap trader reported. "It is true that busheling scrap and turnings are more available than heavy scrap, but it is only because there is a lower demand for these qualities," another Italian scrap trader commented.

All sources interviewed by SteelOrbis agreed that any negotiations will begin to be postponed to September as early as the end of next week, and, according to some, there will be a sharp drop in scrap purchase offers from mills after the end of August.

To sum up, local scrap prices in Italy have shown a substantially stable trend with some downward adjustments, but the downward pressure continues, especially from those producers who have already planned to interrupt both steel production and collection of the raw material.

Prices include delivery and exclude VAT.

Sluggishness has been registered also in the Spanish market, where prices are stable, although some producers have already announced possible reductions by €10/mt in scrap purchase prices.