EU AVERAGE CARBON STEEL PRICES
- LATEST FORECASTS FROM MEPS
In the flat products category, the EU mills
are now making strong efforts to push up prices for the final
quarter of this year - after cutting back on output over the past
few months. This initiative is likely to be partially successful.
Inventories of hot and cold rolled coil have decreased due to a
combination of lower output and reduced import volumes. A modest
rise in fourth quarter negotiated figures is anticipated for these
products. Success for plate and coated strip may be more difficult
to achieve because the import threat is more severe.
We are forecasting EU price rises for most
products in the Spring of next year. However, these could be
threatened by a new wave of imports from Asia if the differential
between the two regions selling values remains at near the $US100
per tonne mark.
In the long products sector, the events in
the US pushed up scrap costs within the EU. Further increases took
place in early September. This could lead to higher scrap surcharges
for steel buyers in October. We believe that the peak has already
been reached and scrap costs will decline over the next few months
unless other natural catastrophes occur.
MEPS forecast rising steel prices for most
long products in the short term - before falling over the next
months into the Spring of next year. Real demand from the
construction and engineering segments is quite sluggish at the
moment. However, we do anticipate an increase in prices when the
weather improves and activity expands once again in 2006. We do not
anticipate scrap selling prices falling to the lows of June 2005 in
the medium term.
