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GERMAN STEEL PRICE
MARKET ROUNDUP
Most consuming sectors of hot rolled coil are healthy with the
exception of the pipe making industry, which is weaker than the
others. The steel companies, seeing that demand was not huge, have
revised their figures downwards to a greater extent than was
anticipated by several buyers. Stocks at the service centres are
relatively low. Distributors will need to purchase after the
holidays and some may even start to do so in the remaining weeks of
July, while prices are low.
Underlying demand for commodity plate has shown no signs of
improvement so prices in several countries have suffered as a
result. Although stock levels are low throughout Europe, buyers are
loathe to reorder before the holidays. However, material will be
needed come September, which bodes well for sales in the autumn.
Consumption of the higher specifications continues to be healthy,
with producers lifting basis numbers for deliveries in the third
quarter.
The German mills are not so dependent on the commodity grades as
their rolling schedules are full with orders for the more exotic
qualities for the next three months and beyond. Wind tower and
line-pipe markets are particularly busy. Consequently, producers
have held on to prices for commercial material, although customers
are pushing for discounts by quoting cheap Chinese offers.
European cold rolled coil demand shows no signs of revival.
Customers are wary of placing new business because they anticipate
that prices could go even lower.
Although underlying consumption is good in Germany, most buyers have
postponed order placement in the hope of cheaper prices in the
latter half of the third trimester. As a result, the mills have
offered substantial discounts.
German domestic basis values for hot dipped galvanised coil have
slipped during recent negotiations for late third quarter business.
The lowest offers are still from Italian suppliers, who have little
demand in their home market. Output in the vehicle industry
continues to be buoyant.
Producers conceded another decrease for sales of electro-zinc coated
coil during negotiations for August/September deliveries.
Prices for low carbon wire rod have stabilised after last month’s
slippage. The recoil market is quiet. Customers have very little
business and are only placing small quantities at any one time.
Despite slow demand for structural sections, some mills are trying
to lift effective values. So far, customers are resisting the move.
Inventories are low at the distributors and some replenishment will
be necessary quite soon.
Customers are keeping rebar stocks very low. Although demand is
better than elsewhere in Western Europe, the market is still very
quiet.
The merchant bar market is dull. Despite efforts by producers to
advance effective prices, they have actually fallen as the stockists
continue to purchase cautiously because their resale margins are
poor.
Source: MEPS - European
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