Downward pressure on coil prices paid by users to distributors in NW Europe is continuing, and distribution input prices remain too high to allow for satisfactory business, Kallanish hears from market participants. This cannot go on for too long, and mills will have to move, they say.

“Prices have fallen daily all through the month, the price we achieve on the market for cut-to size hot-rolled sheet is now at €510/tonne ($569/t). And this is giving us headaches,” is how a manager from a German service centre describes the situation. The outsell price is certainly not in harmony with an ex-works intake price of €490/t that prevailed in March, sources agree.

Mills are remaining quiet about any price adjustments, the manager says. Both he and other senior executives refrain from giving a valid buying price, although it would have to be reasonably below €490/t by now. According to a Dutch source, some European mills are currently even trying to sell into North Africa, where prices are traditionally low by comparison.

“Stocks at the distributors are still fairly high and the delivery times of European steelmakers have fallen to normal periods of about 6-8 weeks, so buyers continue to take a wait-and-see stance,” the latter observes. “Are prices gradually going to fall even further or are they staying stable?” he wonders.

The German manager suspects that mill prices have come down to a possible €470/t by now, but even that level will fail to make service centres happy. “It would have to be €440-450,” he says.