Monthly negotiations have come to an end in the local German scrap market. As SteelOrbis hypothesized last week, new deal prices registered a drop by an average €12/mt compared to last month. The new levels will probably be disclosed after the Easter break.
Depending on the mill, April purchase prices have dropped by €5/mt, €10/mt or €20/mt. Contrary to last week’s statement, the major local producer did not cut its purchase price by €30/mt, but by around €10-15/mt for 180,000 mt. Deliveries, however, will be delayed due to the low water levels in the Rhine.
“What is currently creating significant pressure [on local scrap prices in Germany] is the export market, where [scrap sales] prices are collapsing. There have been no major sales,” a source said, adding, “I assume that regional mills will continue to reduce prices in future deals, as they don’t need to worry about volumes flowing into export markets.” With the dollar at 1.13 on the euro, deep sea exports from European ports are still difficult, and HMS I/II 80:20 collection prices for export yards have dropped to €270-275/mt DAP, versus €280-285/mt DAP last week. “Exports are static. We’re at the mercy of international markets,” another source commented.
Most local traders are out of the market at the moment, and they are planning to remain so until May. “Foreign [scrap] suppliers were in a hurry to sell at unchanged prices very early in the month this time,” an Italian producer importing from Germany stated. “That’s why I had the feeling that the [scrap] market was going to decline there”, he concluded.
In the meantime, as SteelOrbis reported on April 15, the German steel producer Salzgitter decided not to accept the takeover bid from the consortium of GP Günter Papenburg Aktiengesellschaft and TSR Recycling GmbH & Co. KG, stating that the positive impact expected from the incoming German government's economic policy measures and its expanded performance program P28 will strengthen the company’s competitiveness in the future.
