Rising costs lead to higher domestic prices for rebar in Europe
Domestic rebar prices in Europe continued to rise during the week to Wednesday, February 4, driven by rising production costs, especially for scrap metal and energy, market participants told Fastmarkets.
Sources said there is a growing demand for scrap steel in the EU due to a slowdown in steel imports following the introduction of the Carbon Boundary Regulation Mechanism (CBAM) at the beginning of the year.
The reduction in imports of steel billets and long products has led to increased dependence on domestic supplies, the sources said, which has increased demand for scrap for the production of long products in Europe, where electric arc furnaces are used.
However, scrap metal collection in Europe has decreased recently due to seasonal factors and more severe weather conditions in some regions.
"There is an acute shortage of scrap in Europe," a local producer of long products told Fastmarkets.
A producer from Northern Europe reported a price increase in February of 20 euros per ton of old scrap and 15 euros per ton of new compared to January.
A source from Italy, meanwhile, said that scrap metal prices there have increased by more than 20 euros per ton over the past two months, while electricity costs were about 15% higher than predicted by the plant in January.
Due to these conditions, factories across Europe have attempted to raise prices, which are gradually being accepted by consumers.
New offers for 8-40 mm thick rebar in a wide range have appeared in Italy at a price of 595-640 euros per ton from the factory, depending on the plant and the region, sources said, while lower prices are traditionally considered typical for northern Italy, while higher prices are for Northern Italy. the situation in the southern regions of the country.
It was also stated that the selling prices are in a fairly wide range, depending on the factory, region and cargo size.
According to sources, sales in northern Italy were mainly carried out at the level of 580-610 euros per ton from the plant.
In southern Italy, deals were struck at prices of up to 640 euros per ton from the plant, the sources said, adding that this level was not widely accepted, leading to a situation that a local trade source described as "great chaos."
Fastmarkets' weekly estimate of prices for steel rebar for domestic consumption (exw) in Italy on Wednesday was 580-630 euros per ton from the factory, down from 560-590 euros per ton on January 28. The average price was 605 euros per ton.
.There were growing concerns among market participants that the 400,000-ton-per-year rebar production plant owned by the market leader Pittini in Verona would affect prices in the near future.