During the summer holidays, the activity on the rolled steel market in the EU countries was suspended. In early /mid September the market remained sluggish. Little or no overall demand is expected in the short term.
Tensions in global trade and political uncertainty continue to cause great caution among market participants. Steelworkers, whose profit margins are declining, tried to raise base prices, but their offers were rejected by buyers. Purchasing executives across Europe were able to negotiate renewals or even small discounts in some cases with regional steel producers. Despite production cuts in large factories, customers do not feel a significant supply constraint, although delivery times have increased.
The lack of activity in the automotive industry continues to have a negative impact on the German economy. After years of growth, new car production has slowed. Against the backdrop of pessimistic forecasts, the activity on the steel market decreased. Service centers are actively selling out stocks in excess of their needs. Suppliers are short of orders, negating any opportunity for price increases.
At the beginning of September, activity on the French flat steel market slowed down, which affects prices. Several factories are reported to be trying to sell unsold products.
Italian companies recorded the thirteenth consecutive monthly decline in production and new orders in August. Market participants are pinning their hopes on the new government, but so far the steel industry is in a depressed state, with little sign of a recovery in demand after the summer break. Manufacturers tried to maintain or even raise current prices in the summer, but their ambitions were faced with a deterioration in consumer sentiment in the domestic and foreign markets and a decline in the cost of iron ore.
In the UK industrial sector, production declined in August due to the largest decline in new orders in seven years. In the steel sector, a number of service centers were provided with jobs in July-August despite the traditional seasonal decline. However, distributors associated with the automotive industry are reporting a deteriorating business environment.
The Spanish industry in August saw the sharpest drop in production since May 2013 and a further decline in new orders. This month has been a tough one for the Spanish service centers. Market participants were reluctant to replenish stocks amid falling prices. And while the real activity remains at a low level.
