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Kallanish Kallanish

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December, 14th 2018

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DEC 06
11:57

Italian merchant bar prices improve on capacity cuts

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Italian merchant bar prices are stable on those of last week after having increased by €10/tonne ($11.3/t) compared to November, Kallanish learns from market sources.

Both domestic merchant bar offers and sales have slightly improved after a few difficult months because local producers have addressed the problem of domestic overcapacity. They have done this by implementing production stoppages in November and December with the result of lowering stocks which had become too high.

This year some longs’ producers will implement extended stoppages for Christmas and one in particular will commence next Monday, albeit whilst continuing to receive scrap and manning offices. Due to the current trend towards limiting production, merchant bar sales are increasing as buyers have rushed to purchase before the plants halt operations, Kallanish hears.

Prices for domestic material are now at €130-135/t base ex-works. In November they had dropped to €115-120/t base ex-works, as reported. This leaves transaction prices at €550/t ex-works including extras, sources suggest.

Meanwhile, prices for domestic beams are also stable at a high level, at €230/t base ex-works for the first category of beams. €380-385/t must then be added for extras. The current price strength is due to low availability, low stocks and long delivery times at a major Italian producer, Kallanish hears.