STEEL NEWS

In Germany, expected to increase production and rise in steel prices

According to Platts in its monthly report, the price sentiment on the German steel market in January remained optimistic and all market participants expect an increase in costs for both steel and raw materials, while the majority of respondents are optimistic about the increase in capacity in the near future. Production is expected to pick up as more blast furnaces are scheduled to restart in the first quarter of 2021, although maintenance problems in some European plants could lead to potential delays. Several market sources said blast furnaces at the plants in Ghent, Bremen and Dunkerk have already returned to full capacity this month. According to the survey, the output in January was higher - 68, compared to December 53.

In a survey of German manufacturers, distributors and traders conducted in early January, the steel price dynamics index stood at 91, as did the December survey, indicating expectations of significant growth (index 50 indicates stability).

Sources say the rise in prices was fueled by a shortage of steel in the market, and factory orders were sold out in the first quarter. Buyers are currently awaiting offers for early April, and orders in the second quarter are expected to ship in June-July.

Hot rolled coils and hot dipped galvanized products were extremely difficult to buy due to significant demand for cars, long lead times and expensive import offers, leaving shoppers with few points to buy.

Since the beginning of December, hot rolled coil prices in Northern Europe have increased by 21% compared to the previous month, while in Italy hot rolled coil prices have increased by 25%.

Inventory expectations in January were slightly higher than usual. “The important thing is that we have a large number of orders for the future. We are scared because we ordered so many [in November-December], so we will receive a lot of materials in the second quarter.