Local Italian scrap prices edge up slightly, further rises expected in May

Local scrap prices have risen slightly in Italy this week, supported by the shortage of material and the needs of some steel mills to conclude purchases. Market participants expect further rises for May, although steel mills will try to resist given the difficult situation in terms of sales and new orders for finished products.

After four weeks of stability, local scrap prices have gained an average of €5-10/mt over the past week. According to market participants, some steel mills with low scrap inventories have been forced to increase purchase prices in order to secure material, as there remains a substantial shortage of raw material in the market so that “those who want to buy have to add something”, as one source put it. According to sellers, this situation will continue in the coming weeks, leading to further rises for the month of May.

Steel mills, for their part, are trying to resist the increases in view of the difficult situation in which the finished market has been for some time. One steel mill official said that market sentiment is negative and that demand for finished steel is not expected to improve given the insecurity caused by the ongoing wars. Moreover, several sources said that many domestic producers are working with negative margins and that some mills will take advantage of the holidays between April 25 and May 1 to slow down or stop production.

Prices include delivery and exclude VAT.

Traders in the Spanish scrap market stated that local prices have remained unchanged this week, but they reported a slight increase in import scrap prices. According to sources, Spanish steel mills also complain that they are working with very limited margins, despite low energy prices.

Prices include delivery and exclude VAT.