Local Italian scrap prices fall during summer holidays, negative outlook for September

In August, local scrap prices in Italy lost an average of €20-25/mt. According to sources, prices were dragged down by the declines in the European and international markets and by the continuing difficulties in the finished steel market. “The restart was worse than expected because the slump in international quotations of finished products and scrap deeply affected the European market,” an Italian steel mill official commented. Another market participant added, “Some mills have not yet resumed operations and in any case scrap yards are quite full as we have been idle all August and there are no new incoming orders”.

Given the extremely weak situation in the finished market, steel mills are intent on lowering scrap purchase prices even further in the near future. On the other hand, traders point out that, although demand for raw material is extremely low, supply is also very scarce and it is difficult to predict in which direction prices will move.

Prices include delivery and exclude VAT.

Over the past month, the local scrap market in Spain has also experienced a significant drop, losing €25-30/mt. According to market participants, the fall in prices was due to the low trading activity during the summer holidays, as smaller mills remained out of the market throughout August. This week, all producers and traders should resume full operations, and so market participants expected a slight improvement in trading activity and a €10/mt recovery in local scrap prices. However, these predictions did not materialize and prices remained stable, with smaller mills aligning their prices with those in the market.

Prices include delivery and exclude VAT.