After the return from the holidays, the Italian domestic scrap market has seen increases in the range of €10-15 ($13-19/mt)range, and also by as much as €20 ($26/mt), compared to the last supply contracts inked in late July. The month of August has been characterized by almost zero levels of transaction activity as hardly any domestic producer has purchased new material. Those few who did anticipated the price increase, while the majority of steel producers got back into the market in September and aligned themselves to the rising tendency. According to the latest market update by SteelOrbis, current average scrap prices in Italy are as follows:
Quality |
Average price |
|
Sept 7 (€/mt) |
July 27 (€/mt) |
|
HMS |
280-295 ($358-378/mt) |
270-285 ($346-365/mt) |
Shredded scrap (E40) |
310-325 ($397-406/mt) |
300-310 ($384-397/mt) |
Busheling (E8) / (E8C) |
305-315/325 ($390-403/416/mt) |
290-310/315 ($371-397/403/mt) |
*Prices are for delivery to customer and exclude VAT
The uptrend on the Italian domestic market has been ignited by two factors: the recovery of scrap prices during August in France and Germany, and the need of steelmakers to replenish their scrap yards. In fact, most of them reduced their reserves in order to reach the summer break with minimal scrap volumes in stock. Indeed, the demand level in the first week of September has been very high.
Meanwhile, some scrap traders state they are already sensing a slowdown of the rebound in market activity. In fact, steel mills have already concluded bookings for a remarkable volume of raw materials and, due to the poor outlook for finished product demand and prices, purchase managers are hesitating to sign new contracts at the same price level accepted at the start of September.
Another major issue is the evolution of iron ore prices, the downtrend of which could affect the international scrap markets.
€1 = $ 1.28