Prices on all products in EU have taken a dramatic jump during last week, pushed by the announcements by mills on the pretext of partially implemented increases of raw materials.
After Vale of Brazil was announcing an increase of 90% in its offers for deliveries 2nd quarter onwards, it seems that a race has started among all producers to announce the highest possible price increase. The "fever" was touching all categories of producers, including both long and flat products. Increases have obviously shocked the biggest part of the buyers that have immediately taken an attitude of wait and see. Mostly of them don''t believe that the present wave of increases will last for long time as consumption and demand are basically remaining to the same levels of end 2009 and beginning of 2010, to say at full unsatisfactory performances.
Scrap is increasing in price day by day with billets having already crossed the USD 500 per tonne FOB ST Black Sea mark and being sold to Italy at prices ranging between USD 530 per tonne to USD 540 per tonne CFR F. However new offers at USD 550 per tonne to USD 50 per tonne CFR FO have been flatly refused by buyers, at least for the time being.
Pig iron from Black Sea was offered early this week at USD 410 per tonne FOB, with relevant offers from traders to buyers in Italy at around USD 470 per tonne to USD 480 per tonne CFR FO. However, according to last in formations it seems that not even at this level Ukrainian Mills are available to book orders but holding back and look for prices up to USD 500 per tonne CFR FO.
Russian mills announced their new prices for Europe on Friday reflecting the buoyancy in the market
HR
North Europe - EUR 510 per tonne CFR FO Antwerp or equivalent port
South Europe - EUR 500 per tonne CFR FO Mediterranean Port
CR
North Europe - EUR 560 per tonne CFR FO Antwerp or equivalent port
South Europe - EUR 560 per tonne CFR FO Mediterranean Port
All prices are considered base +applicable extras.
On the other hand stocks are sensibly lower than last quarter 2009 and many stock holders, SSC and distributors are almost obliged to book orders, which is encouraging Mills and traders to take firmer positions.