Unchanged situation in very delicately balanced local Italian scrap market

This week, the local Italian scrap market has remained essentially unchanged, with some mills starting from higher quotations adjusting their price lists while the others confirmed their previous levels. According to sources, raw material prices may have bottomed out and should remain at the current levels considering that the international markets also seem to be rather stable.

However, the balance between supply and demand, both at minimum levels, is extremely delicate according to the sources. “Prices should remain stable unless further production cuts occur. In this event, they could drop. Of course, should demand improve even a little, prices would immediately rise because there is a shortage of raw material,” one trader commented. An official at a steel mill said there is still room for a downward correction of scrap prices, adding, “We have no orders and further production cuts may be necessary to cope with the situation and regain competitiveness.” On the other hand, activity in the finished steel market is extremely slow, with some producers still not back in business after the holidays, while others have delayed restarts due to technical problems.

Prices include delivery and exclude VAT.

The local Spanish scrap market lost another €15-20/mt this week due to low demand for scrap from producers. Market participants think that prices have bottomed out and some expect a €5/mt recovery next week. However, according to one source, “It is difficult to say whether this is a real bottom. There is a lot of uncertainty”.

Prices include delivery and exclude VAT.