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Italy

Confirmation of duties on imports of finished stainless steel products, if there was still a need, gave new life to a market under great pressure. In fact, all stainless steel mills are already selling for December/January delivery. All final consumers are complaining of severe delays in material delivered in previous months by stainless steel mills.

The greatest difficulty in terms of sourcing stainless steel scrap is due to its huge differential to the price of finished product. In fact, the main European steel mills are making a not-too-hidden attempt to suppress the price of scrap despite the exponential growth in the value of their products. Given the high Fe values ​​reached over the recent period, the constant high prices of FeCr as regards the European benchmark (FeCr prices are also rising in Asia) and also the value ​​of nickel, many operators are struggling to accept the quotations for 304 scrap stainless steel. The sales price of scrap delivered to a stainless steel mill for the month of July is just under Euro 1600 per tonne while sheet of the same material has fetched in some cases Euro 4000 per tonne for small volumes.

There is a tug-of-war between steel mill operators who are reducing the quantities of scrap purchased and replacing it with greater consumption of ferro alloys or slabs (not subject to duties), and small producers whose raw material costs have increased considerably but whose scrap is little valued. This situation does nothing but encourage speculative activity.

Despite all of this, no changes of direction are foreseen on either side given the enormous market demand for material. In the coming months, there could be a more marked increase in the price of scrap if stainless steel mills were to encounter greater problems in sourcing alternative raw materials.

At least until the beginning of next year, continued market tension is envisaged both on prices and on the quantities of scrap available.