The lull that has come after the summer holidays in the French steel market is dragging on, and uncertainty and political instability are strongly affecting sentiment.
Market participants report little interest in new purchases as buyers continue to exercise caution. Transaction prices remained virtually unchanged compared to the level of early September, reflecting weak demand and the absence of any signs of recovery, Kallanish notes.
"Steel processors and distributors are unable to make money because there is practically no margin. Companies are chasing volumes and fighting with each other, and negotiations with manufacturers are difficult," one of the market sources comments. Manufacturers of both long and flat rolled products are trying to achieve higher prices, but buyers are still skeptical due to low consumption.
The manufacturer notes that stocks are being depleted slowly, which leads to their accumulation too early this year. Inventory levels usually rise towards the end of the year as customers replenish their inventory before the Christmas holidays. However, the current low growth rates of demand indicate that inventory build-up is taking place prematurely.
French buyers, especially in the sections, are resisting the latest increase in the quotes of ArcelorMittal's long positions by 30 euros per ton ($35 per ton). The situation in the French long-term market remains tense. Foreign candy bar manufacturers have returned with aggressive offers, putting additional pressure on domestic suppliers. Prices for rebar rods currently remain unchanged and amount to 220-230 euros per ton with delivery, excluding additional dimensions.
Prices for rebar bars, after a short-term decline at the end of last month, remain unchanged and average about 600 euros per ton with delivery, while sales are limited to relatively small volumes, and buyers report on the full cost. stocks that are depleted very slowly.
Prices for the sections are also stable and amount to 750 euros per ton, although the plants are trying to raise the supply to 770-780 euros per ton. Many customers have satisfied their needs ahead of the expected price increases and are in no hurry to place orders. As consumption remains low, market sources doubt that producers will be able to achieve higher prices.
Scrap metal prices in Western Europe dropped by 10 euros per ton this month and are forecast to decline again in October after the latest drop in scrap prices in Turkey.
Natalia Capra France
