EUROPE LONG STEEL WRAP: Prices set to weaken in April after rising through March

The European long steel market is expected to weaken next month amid slack demand and downward pressure from scrap prices.

Prices for Europe-origin rebar and wire rod have increased by €5-35 ($5-38) per tonne during March, but started to retreat in the last week of the month.

The March rises were mostly supported by the scrap price increases in the first half of the month, while demand remained sluggish.

Market participants mostly expected prices to go down in April, citing tough competition and cheaper scrap costs, among other reasons.

“I think that [the market] will go further down [amid lower] scrap prices and pressure from the Turkish mills,” a producer source in Southern Europe said.

Metal Bulletin’s daily index for Northern Europe-origin scrap closed at $257.71 per tonne cfr Turkey on March 29, compared with $293.69 per tonne on March 15.

“I think [long steel] prices in Europe will go down a bit following international patterns, especially for scrap prices,” one Italy-based trader said.

In the European domestic market, scrap prices are currently going down as well, after the €30-45 ($33-49) per tonne increase in both Southern Europe and Northern Europe in March, Metal Bulletin understands.

Demand is unlikely to support long steel prices either, as import quotas and licences in Algeria, a key destination for EU-origin long steel products, have not been issued for 2017 yet and the issue date remains unclear.

As rebar and wire rod trade has been practically blocked, Algerian customers have increased their billet imports this year, sources said.

“There is a little bit of pressure and prices may decrease further in April, [as] nothing is happening in Algeria,” an Italian rebar and wire rod producer source said.

“Turnaround might come when Algerian licences are available, because all customers will want to buy at once,” one trader said.

With both export and domestic demand being subdued, a possible shutdown of Russian rebar imports was not expected to bring much relief to the EU mills.

The wire rod market was said to enjoy better demand than the rebar market, and thus prices were expected to be “falling slower”, according to one trader.

However, a recent petition filed by US mills against imports of wire rod from ten countries including Spain and Italy may affect Spanish exports, Metal Bulletin understands.

Meanwhile, Italian mills will not be affected. “I never sold 1 kilogram of wire rod to the US,” a producer source in Italy said.

What to read next
European energy analysts’ “what if” questions have turned into “what now” questions in the wake of Russia’s stalled war efforts against Ukraine
Despite the metal being classed as “strategic” in the European Union’s proposed Critical Raw Materials Act (CRMA), questions remain about the future of magnesium supply in Europe, market participants have told Fastmarkets
The publication of Fastmarkets’ assessment of the Southeast Asia copper premium for Tuesday March 28 was delayed due to a scheduling error.
Recycling is increasingly being considered the best way to reduce carbon emissions from metals production, and huge investment in recycling facilities has been seen in recent years, with robust merger and acquisitions activity
As the world moves toward a shared goal of net-zero emissions, Claire Patel-Campbell talks to Outokumpu’s head of group sustainability, excellence and reliability about the place of the energy-intensive and high emissions ferro-chrome industry in a greener economy
Energy has been at the top of the agenda for the ferro-chrome market over the last couple of years, as prices fluctuate and access to steady supplies becomes more uncertain
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
Proceed