The Italian rebar market slowed again last week as falling scrap values caused further erosion in domestic rebar prices, Kallanish notes.

Rebar prices have fallen by €20/tonne ($24.9/t) compared to the beginning of the month and by €40-50/t compared to the high points seen in January.

This is due mainly to falling prices for demolition scrap qualities E1 and E3 for which values have been slashed by €20-30/t month-on-month depending on grade. The Italian rebar market is particularly sensitive to scrap price movements. Prices are particularly volatile due to a number of large- and mid-sized mills having increased rebar production, growing exports and more competition in the domestic market.

However, as last week ended, there have been signals of a scrap price recovery in Turkey followed by increases in billet export prices from the CIS region. This should be the prelude to an uptick in Italian scrap, rebar and pig iron prices in the second half of the month, sources polled by Kallanish believe.

From the January peak of €270/t base ex-works, domestic rebar prices have fallen gradually to €240/t on average base ex-works in February and have now further retreated to €220-230/t. This, including size extras, sets the current transaction price range at €480-490/t ex-works, sources suggest.