EU AVERAGE CARBON STEEL PRICES
- LATEST FORECASTS FROM MEPS
The general weak market conditions in the
strip mill segment extended into March - as customers held back on
ordering due to high inventories. Most EU producers have been
indicating an increase of at least €15 per tonne for second
quarter deliveries. It is now becoming clear that such rises will be
difficult to achieve - given the high level of stocks in the supply
chain. In fact, we are reporting small decreases in March for the
coated and cold rolled products.
We forecast slow but steady deterioration
in strip mill prices over the next twelve months. Any possible gains
which may have been obtained from higher input costs will probably
be lost due to the current oversupply situation. Any price recovery
will depend on the mills curtailing production soon.
Plate prices also slipped this month.
However, the prospects are for increases in the second quarter.
However, the malaise in the strip segment is likely to work through
into the plate market in late Summer.
In the long products sector, the poor
Winter weather extended into March. The anticipated price stability
was transformed into significant reductions as a result.
We believe that demand will pick up for all
products in May. Moreover, the escalating price of iron ore and coal
will probably lead to higher scrap costs when consumption rises. We
forecast price rises in the period May to September for all long
product categories. However, a decrease is anticipated in the final
months of 2005 and should continue into 2006.
