THE MEPS COMPOSITE NORDIC AVERAGE STEEL PRICE HOLDS FIRM IN JUNE

Flat Products values in the Nordic region were largely unchanged in June, suggesting that the bottom of the current price cycle has been reached. The exception is in hot rolled plate, where there may be scope for a further, small, downward adjustment. Delivery leadtimes for all flat products are stretching out to September and even October, as a result of the ongoing production curbs and the approaching summer shutdowns.
Although the major producers have been seeking higher selling figures, there has been no sign of an increase in underlying demand. However, most stockists and end-users have run their inventories very low and this is beginning to reveal shortages of certain items, particularly in coated products.

The ArcelorMittal scrap surcharge for medium sections and beams rose by €19 to €87 per tonne in June. This increase was reflected in the effective prices of most long products in deals concluded at the beginning of June. However, reduced demand for scrap caused its value to fall away as the month progressed. As a result, lower transaction figures are forecast for long products in July.

The traditional holiday periods in Scandinavia in July and elsewhere in Europe during August will result in a quiet couple of months, exacerbated by the current economic situation. Market participants are therefore looking to September to provide an indication of trends for the remainder of 2009. MEPS forecasts a modest upturn in prices for third quarter deliveries.
 

Source: European Steel Review Supplement by MEPS (International) Ltd.