Southern European longs market fails to improve, some import offers may attract interest

Friday, 09 February 2024 13:54:08 (GMT+3)   |   Brescia
       

A period of crisis in the southern European longs market continues, particularly in the rebar segment. In Italy, a situation of weak demand and excessive supply prevails, while imports, especially from Egypt, begin to be attractive.

In the local rebar market in Italy, producers’ attempts to increase prices are gradually fading, with higher prices becoming unreachable. The tradable level has been reported at €340-360/mt ex-works base (€605-625/mt ex-works including regular extras), with a drop of €10/mt on the lower end of the range over the past week. The declining scrap prices create even greater confusion about the trend. Steel mills are selling bit by bit, but buyers also seem to not have much inventory: for optimists, this means that they could see a rise in offer prices in March. However, the general market expectation for the coming couple of weeks is rather gloomy.

Italian rebar export offers have been reported stable week on week at €610/mt FOB, but without decent interest from buyers.

In the export segment, demand is increasingly quiet, due to low prices from Turkey and Egypt. “We have reduced production and cannot compete since we have rather high costs [mainly scrap and energy]”, a Greek producer told SteelOrbis. “We will proceed only if we manage to get some orders above €630/mt FOB,” he added. In Greece, in fact, according to sources, the market seems to be increasingly oriented towards local sales by the mills. Tradable export prices should be at €610/mt FOB at the highest in order to be workable in some European countries, but Greek producers are unlikely to be able to offer them. Ex-Greece offers have been reported at €620/mt FOB for rebar and €640/mt FOB for wire rod, the same as last week.

Import offers are becoming more interesting, especially for shipments which do not require navigation through the Red Sea. As a result, while Asian material remains unattractive, some interest may be seen in products from Turkey and Egypt. Ex-Egypt offers have been reported at €590/mt CFR southern Europe for rebar and €590-600/mt CFR for wire rod, while ex-Turkey rebar offers have been stated at €595-605/mt CFR and wire rod offers at €610-620/mt CFR. However, some of the Italian customers are citing long delivery times, additional costs, and the small difference with local prices as obstacles to relatively lively imports.


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