Genoa, Italy – This summer will be remembered for many events. The positive solution of the third Greek bailout reached after very long and uncertain negotiations. The breaking of the BRICs after over a decade of growth and in particular the Chinese financial crisis that throws the markets across the globe into panic. The fall of the energy prices, caused by the collapse of the oil, has been positive any time we refueled our cars and boats. The large flow of migrants and the thousands of refugees just entered or still trying to enter in the European Countries from the Middle East and Africa will remain in our eyes for long time.
The poor performance of the recovery for the 19 strong Euro area countries is disappointing all of us, because it means that we will have to wait longer to recovery. The decreasing of the worldwide steel production convinces everybody to face more hard situations in the short future. Last but not least the Queen Elizabeth’s record of 63-year of reign: After 63 years she is as popular as ever considering that seven out of ten people in Britain are in favor of the Monarchy.
Coming back to the recycling business, the July and August scrap prices moved down around 35/40€ both on the domestic market and from the European supplies. Several are the causes of this drop: a general lower demand of steel products, the strong offer of Chinese steel at low prices – even if the greater quantity of the purchased billets has still to arrive to the ports -, and the long summer and maintenance mills halts reduced the metallic raw materials consumption and, at the same time, enlarged the inventories both in the mills and the scrap yards. The significant arrivals at the Italian ports in July/August, with abt 30 Kt for scrap, abt 225 Kt for pig iron and abt 150 Kt for HBI, play a part on the mills inventories recovery. The pig iron arrivals have not been influenced by the increased production at the Trieste BF mill, now owned by Arvedi. Scrap dealers are fighting day-by-day with the lower scrap generation, the strong competition, some mills delayed payments and the more and more compressed margins.
Following the August official average prices reported (€/pmt delivered):
New arising E8:
Demolition scrap E3:
The deals for September contracts started with the aim – from buyers side – to cut the August prices of about 15/20€, following the European and deep-sea market. The foreseen metallic raw materials low consumption, due to the weak demand of finished products, will help the mills to achieve their aim.
Some info about ILVA Taranto: The AFO 1 has been restarted after the long revamping to meet the new environment rules. It means that now Taranto could produce around 16 kton/day of pig iron with tree blast furnaces running. The other cleaning up and maintenance activities are carrying on influenced by the always uncertain local situation.
PIG IRON – H.B.I.
As said before, the arrivals at the Italian ports during July and August have been significant. The inventories at ports and mills remain well recovered. The last pig iron offers are quoted around US-$ 225/230 pmt CIF for September / October shipment. The July and August HBI cargoes arrived from Libya, Venezuela and Russia. Last HBI offers are reported around US-$ 215/220 pmt CIF Italy.
Source: Alocci Rappresentanze Industriali