January was characterized by variable trends for Italian scrap, but, overall, there was a reconfirmation of the stability of the market, said Assofermet, the association representing Italian distributors of scrap, raw materials, and steel products, in a press release.
In Italy, the rise in quotations in the first part of the month was followed by decent demand from steel mills, although some plants restarted late and did not work at full capacity.
"After a price rise in the range of €15 to €20 in the first half of the month, prices then remained stable until the end of January," the association said, adding, "As previously reported, there remains concern about the cost of road and rail transport."
The sentiment for February seems positive overall, albeit with some uncertainty about the production volumes from steel mills. "The hope is that orders for finished products will be numerous and that there will be effective demand from end-users,” Assofermet said.
In the international market, the month of January saw alternating phases: in the first part of the month prices rose on the back of the end of 2022, then quotations fell and finally there was a slight positive variation.
According to the press release, the Turkish market mirrored this trend: the downward phase stopped at a low of $400 CFR for MS 80/20 grade, before returning to the level of quotations in the first part of the month.
"European markets remained stable, and demand for raw materials from steel mills saw a small discontinuity in relation to price fluctuations in the international market," the association said.
However, rail transportation costs were still on the rise.
As for stainless scrap, according to Assofermet, after the first part of the month reconfirming year-end quotations, January saw a slight price correction in the second half in the face of scarce demand for scrap from steel mills.
"The downward correction was met with difficulties on the part of the market in accepting these reductions, resulting in a decline in volumes traded and an increase in stocks," the association stated. "On the international market, reduced volumes were also noted as a result of the strengthening of the euro against the dollar. There is an expectation for the reopening of the Chinese market after its closure for the New Year, as to date the Asian market appears to have more competitive quotations than the European market, thus penalizing European exports."
January also saw an uptick in prices for the remaining available cast iron of Ukrainian and Russian origin for purchases mainly completed by traders and for material that will essentially be sold to foundries, a sector currently able to pay for the new increases.
In stark contrast to other materials (scrap, steels), which showed significant price increases, hematite pig iron showed sharp declines due to substantial inventories that led to a drop in demand.
In this segment, too, the main concern is the cost of transportation, which, in addition to still showing malfunctions in some rail hubs, has seen major increases. "Rises in rail transport costs have been even more significant than in road transport," the association added.