Price increases requested by southern European longs producers are beginning to consolidate in the market, where many customers are starting to need material. "These increases will be confirmed in January as well," one source stated, reflecting the views of others.
In the rebar segment in Italy, increases demanded by steel mills have accelerated the shipment of old orders: customers are beginning to believe in increases for December and January and are rushing to pick up orders. The current price is at €330-350/mt ex-works base (€595-615/mt including regular extras), stable compared to last week, but with customers beginning to be forced to buy at these levels, having now almost exhausted previous orders at €40-50/mt lower.
Prices in the local wire rod segment have also been stable at around €620-630/mt delivered for drawing quality wire rod and €600/mt delivered for mesh quality wire rod.
On the export side, the situation is uneven. In the eastern European region, with the absence of the local supplier, ArcelorMittal Zenica, in Bosnia and Herzegovina, Italian producers are selling at about €600/mt delivered, which, considering about €20/mt freight to Croatia, is equivalent to about €580/mt ex-works.
In Germany, demand is very low because customers are only working to restore a minimum level of inventory. Some buyers are buying because they are sure of future increases, but those who already have material are not buying more than the bare minimum. German producers have planned shutdowns, due in part to increases in scrap, electricity and logistics costs, with the market not ready to accept them. Consequently, a shortage of material is expected in January. In these markets, Italian producers say they are selling at around €620/mt delivered, similar to the reference price in Croatia, considering a higher transportation cost (around €50/mt).
By sea, demand exists although it is not exceptional. Now, ex-Italy rebar prices are stable at €580-590/mt FOB, but not everyone has material available, so price increases are expected.
Greek sources said they are avoiding low-priced exports due to rising costs, thus maintaining a range of €600-620/mt FOB for rebar and €600-610/mt FOB for wire rod. Ex-Spain rebar offers in central Europe have risen, due to higher costs and rising raw material prices, to €640/mt delivered, which, considering around €30/mt freight, is up by €20/mt from last week’s price.
Among major import sources, offers from Turkey have been heard at €560-580/mt CFR southern Europe for rebar and €570-580/mt CFR for wire rod, stable compared to last week, but, due to increases in import scrap prices, they could increase by about €10/mt next week. Ex-Egypt longs offers have been at around €580/mt CFR, up by €15-30/mt from last week. Sources have talked about an ex-Vietnam wire rod deal at $550/mt FOB, which, considering $60/mt freight, means around €560/mt CFR. Also, ex-Indonesia offers have been reported at around €550-560/mt CFR.