European prices for long products are rising, although less than expected by producers in January. Several factories have told Kallanish that they expect prices to rise gradually and will try to take a tough stance as rising production costs force them to push for further price increases this month.
Some producers in Northern Europe confirm that they have temporarily suspended sales in order to assess the impact of recent price increases on energy and raw materials before publishing new price lists. A number of countries are continuing to reduce production in order to balance supply and demand as consumption continues to decline. One source notes that in recent weeks, electricity and gas prices across Europe have continued to rise, which has had a significant impact on European chipboard manufacturers. Another adds that scrap metal prices have been rising steadily in recent months, and February has brought additional, and in some cases unexpected, spikes across Europe.
One producer says that he has managed to raise the prices of rolled products by about 35 euros per ton ($41.46 per ton), depending on the product, compared with the level of November and early December. However, the steel producer adds that prices are unsustainable and no longer cover current production costs. Based on today's cost structure, the manufacturer estimates that the price for the first batch of sections should be about 770 euros per ton, compared to current levels, which are 30-40 euros per ton lower depending on the country. Similarly, a wire rod of mesh quality should cost at least 650 euros per ton, while the drawing material should be about 15 euros more expensive so that manufacturers can achieve positive profitability.
Some buyers claim that it is still difficult to achieve price increases in the secondary market in this market, especially for products such as fittings. Rebar consumption in Europe remains low, and prices rose only slightly in January, while remaining at the same level in some markets. However, sources expect demand to improve "after the harsh winter" as the peak of the construction season approaches.
Some steel producers in both northern and southern Europe confirm that they are reducing production, while others say they prefer to maintain high production levels to avoid higher fixed costs.
Author: Natalia Capra France
Kallanish.com
