Posted on 22 Feb 2019
Italian hot rolled coil producers are pushing up asking prices to the level of €500/tonne ($566.7/t) base ex-works, market sources tell Kallanish. One producer is increasing its price to €520/t base ex-works.
It is the first time for several months that Italian HRC has touched €500/t following a period of depressed demand and low offers. However, an uncertain market for service centres and re-rollers means that transaction prices are differing quite markedly from current asking prices.
Mills are managing to achieve and consolidate a price level of €470-480/t base ex-works in transactions this week. So far Kallanish has not heard of any contracts being signed at €500/t. However, due to a series of market-influencing factors, the target of €500/t may be achieved over the coming weeks, sources believe. These factors include the general wave of increases in European flat products, the increase raw material prices and, more specifically, the current hikes in Turkish HRC offered to Italy.
However, service centres are encountering difficulties with a level of final demand that they have seen decrease significantly in recent months. Service centres who spoke to Kallanish do not believe that the current increases will hold because they are failing to pass them on to their customers. They suggest also that margins are eroding. Some of them have therefore decided not to purchase and to rely solely on their stocks for the reminder of the month.
