Steel prices have gone down across of all flat products in Europe, as a result of an extremely reduced activity with basically no bookings. However, due to the deteriorated exchange rate of Euro against USD, nominal prices have in some cases increased, mainly for long products.
It appears more and more clear that EU markets are divided in two segments.
North (Germany, Benelux and Baltic countries) are dealing quite well, with local Steel Mills basically fully booked till August September and local distributors receiving much lower quantities than their need. It is said that ThyssenKrupp distribution system is receiving no more than 25% to 30% of their need from mother mills and thus eagerly looking for buying from import. Thus prices are going up, mainly for HRP and CR with Russian Mills Severstal, NLMK and MMK taking great advantage from such situation.
South EU (Spain, Italy, Portugal and other surrounding countries) are on the contrary crossing an extremely gloomy period due to the general economic situation and a parallel sluggish consumption and demand. During this past week, all distributors and SSC were struggling to get orders but news are that they could collect very little compared with levels of March and April. The fact is that all customers and end users were buying quite a lot during the past two months on the wave of the price increases occurred during that period. Now everybody is resisting to the offers and eventually buying only the strictly necessary.
However between end of May and beginning of June demand should revive as many operators are starting to have un-assorted stocks. That would be the crossing point between a possible new price increase or a further and, this time, quite sharp decrease.
All will depend on the move of the Chinese Mills. In case, due to their domestic slow down activity and impossibility of finding enough sale volumes in Far East, USA and South East Asia, they will decide to accept South EU levels, prices will definitely go down and possibly for a quite big extent. Otherwise, prices should probably go up again as availability will remain scarce, basically relying only on Russian and Ukrainian Mills.