EU prices continue to increase

EU prices continue to increase. The mills are insisting that they must go up again in period three to reflect the rising costs of production. The initiatives are likely to be accepted due to a lack of any competitively priced alternatives. Import volumes into Europe remain very low and this is contributing to already limited availability from local steelmakers. The soaring prices are clearly not driven by demand, which is relatively modest. Inventories, generally, are not growing because it is too costly to finance steel stocks.

The German mills are talking of hefty price rises on strip mill products in the third quarter. Service centre inventories of commodity grade coil are adequate with some buyers refusing to place further orders at present. However, availability of the higher specifications appears to be more constrained and some gaps are appearing. Real demand is no better than “normal”. The strong Euro continues to have a negative effect on exports of manufactured goods…more at MEPS