Steel prices are already close to minimum – Marcegaglia

Italian reroller company Marcegaglia believes that steel prices are close to the minimum and expects a technical rebound of quotations by 8-10%, due to the slowly returning demand. Eurometal writes about it with the reference to S&P Global Commodity Insights.

“I think that in few weeks, or after the summer break, prices will go up again by around 8%-10% from today’s level as little-by-little demand comes back… but also because steelmakers need to offset the higher raw materials costs,” Chairman Antonio Marcegaglia told in an interview.

He added that the exchange rate factor is also important –  with the dollar/euro exchange rate, raw materials became more expensive for European companies.

“The demand for steel products is back after a period of de-stocking, we see this from our end-users,” Marcegaglia said, adding that he expected overall steel consumption in Europe for 2022 to be 3%-5% lower year on year.

Marcegaglia’s steel output in 2022 is likely to be in line with the general decrease in demand, falling by 3-5% compared to 2021, when the company produced 5.8 million tonnes of steel.

As GMK Center reported earlier, steelmakers in many regions of the world stop or reduce capacity due to the drop in demand for steel products. Steel companies are expecting an increase in demand and an increase in steel prices in the fall, after the end of the summer period of decline in business activity.

European steel prices continued to decrease in July, although the overall rate of decline has slowed.