The bull is till well in force and still strongly pushing up prices across all products and categories in Europe.
Flat products have substantially increased basis prices pushed up by news of further price increases of raw materials obtained by Brazilian suppliers during the negotiations with Japanese buyers. Many EU domestic producers have one again suspended offering, trying to take advantage of the situation.
Italian integrated steel Mill Riva, after offers quoted at around EUR 570 per tonne parity Milan for its commercial quality and regular HRC size range, have suspended offering and is supposed to come back with new prices after Easter Holiday.
Ukrainian and Russian Mills have again increased prices, bringing HRP to about USD 710 per tonne for base FOB Black Sea, while HR was offered at no less than USD 635 per tonne FON Black Sea with some mills already targeting the USD 700 mark.
Pig iron has reached USD 540 per tonne CFR FO Med port, with billets and slabs are being offered at more than USD 600 per tonne FOB Black Sea.
The main factor that is making rather easy for mills to announce and obtain price increases is the still low level of production that, in some cases such as in Ukraine, is not yet reaching the 50% of the installed capacities. Because the prices of Chinese and Indian mills are still far away from acceptable to EU buyers, as their levels are definitely too high and because of unexploited production capacities, the feeling across all EU market is that of a generalized shortage. As a consequence buyers and end users are quite strong in their purchase decisions as mainly of them are convinced that prices will keep rising, at least in the short and medium term.
On the other end, although better than beginning of the year, consumption is remaining at levels definitely non satisfactory, with mainly reinforcing bars languishing because of poor and difficult sales.
The situation is some how worrying as the sudden and sharp price increases are closely recalling mid 2008, however for many operators there is no other alternative than to follow the trend if they don't want to remain back lined and risk to be pushed out of the market.