Assofermet: Steel market sees slow recovery amid limited demand

The Italian metal association Assofermet reports that the steel market experienced a slow start in January, with weak domestic demand and production delays extending into the month. Many end-of-year contracts were executed in January, while scrap metal shortages contributed to price increases of €5-15 per ton towards the end of the month and early February. Despite a continued upward trend in finished steel prices, Italian steel mills faced challenges in passing on cost increases.

According to Assofermet, the global steel market showed signs of a downturn, with declining prices and lower trading volumes across multiple regions. In the international scrap market, January saw limited transactions, with Turkey experiencing gradual price declines followed by a slight rebound in early February. European markets showed slow and delayed activity, except in France and Germany, where price reductions persisted due to adequate supply.

In the domestic market, Assofermet notes that Italian stainless steel scrap prices faced moderate declines, reflecting lower demand from steelmakers. Rapid steel grades remained stable, while alloy steel prices continued to drop, aligning with the overall downturn in the stainless steel sector.

Looking ahead, Assofermet expresses concern over ongoing market uncertainty, citing factors such as global demand fluctuations, energy costs, and raw material prices. Italian steel production operated at reduced levels due to weak domestic and international demand, coupled with high energy costs. Scrap metal availability remained low as industrial production continued at minimal levels.

The international pig iron market mirrored this trend, with declining prices in late January. Ukrainian pig iron returned to the market, albeit in limited volumes and at higher prices than Russian material. Assofermet highlights that while the market remains cautious about the long-term availability of Russian pig iron beyond 2027, immediate concerns among industry players are minimal.

Logistical conditions remained stable due to favorable weather, though rail network maintenance led to increased transport costs. The outlook for ferroalloys remains uncertain following an EU safeguard investigation initiated in December, which led to a 4-5% price increase. Assofermet warns that further regulatory actions could introduce additional market volatility from April onward.

Source: Assofermet, Photo: Fotolia