As reported by various market sources, European steel producers are raising prices again. One southern European mill is even resorting to an “extra-ordinary scrap surcharge”. These precarious trading conditions are met with understandable incomprehension by many steel purchasers.
EU stainless buyers face shortages as prices surge
European stainless steel producers have raised their prices for 300 and 400 series hot and cold rolled coil multiple times throughout December and January. Buyers complain of offers being made by suppliers and withdrawn soon afterwards. In some cases, steelmakers have even declined to quote.
meps.co.uk
AST attempts to retroactively increase stainless steel contract prices – sources
Italian stainless steel producer Acciai Speciali Terni (AST) is attempting to unilaterally and retroactively apply price increases to already-concluded supply contracts agreed with distribution companies, market sources told Fastmarkets on Thursday January 28.
Fastmarkets
Escalating raw material prices and significant shortages of stainless steel scrap
The mills cite escalating raw material prices coupled with significant shortages of stainless steel scrap as the reasons for the price increases. This has led to significant cost increases for steel producers.
Steel purchasers facing long delivery times
In addition to rapidly rising prices, purchasers are facing long delivery times compared to just a few months ago. Companies in the automotive and white goods industries have resumed production, with demand stronger than many had expected.
Low inventory levels throughout the supply chain
This led quite quickly to low inventory levels throughout the distribution chain. Market participants are now reporting serious shortages of certain grades and sizes – especially cold-rolled coils of grade 430.
The extended production times have created difficulties for stockists trying to replenish their stocks with local suppliers.
Sources: Market participants, meps.co.uk, metalbulletin.com
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