The risk of a gradual and irreversible weakening of the European industrial base is becoming more and more tangible, according to the Italian trade association Assofermet. According to her assessment, the service centers working with rolled steel will not be able to accept the new price increase without further deterioration of their competitiveness.
In a recent market overview reviewed by Kallanish, Assofermet notes that European steel companies continue to raise prices for rolled products. This is facilitated by rising energy costs, as well as trade barriers that restrict steel imports, despite the difficult market conditions.
As a result, concern is growing among steel distributors and, above all, among processing plants.
"The gradual recovery after the summer break has ended, but the situation on the international market has remained virtually unchanged since the end of July. Demand continues to be affected by geopolitical tensions, which, in addition to general uncertainty, keeps energy prices at extremely high levels," the association said in a statement.
Assofermet also called on EU institutions to remove all trade and environmental barriers to processed products and semi-finished products throughout the supply chain. According to the association, this is necessary to protect not only primary steel production, but also the entire European industrial system.
In the flat and long products distribution sector, July and August ended with a positive result compared to the same period last year, despite a reduction in volumes. Revenue was helped by a sharp rise in prices following the escalation of the Iran-US conflict, as well as the introduction of a new EU quota regime on July 1. At the same time, volumes were negatively affected by the seasonal summer slowdown and continued weakness in demand from refining.
Compared to the same period last year, the indicators turned out to be less weak than previously expected, indicating the search for a new equilibrium. As before, it remains fragile.
In July, demand was weak, and distributors acted cautiously, while prices partially recovered from the previous decline. In August, prices generally remained stable: European manufacturers, with filled portfolios of orders and stricter import restrictions, laid the foundation for a new increase after the summer break.
The segment of long-rolled products is still the weakest in terms of volume. Stagnation in construction puts pressure on it, but rising prices partially mitigate the decline in monetary terms.
The production of flat rolled hot rolled products, on the contrary, showed an increase in both volume and cost compared to July–August last year, and the average