Italy: Steel scrap market report for May 2014

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Schrott (Foto: Kürth / Recyclingportal)

Genoa — April 2014 will be remembered, not just here in Italy, for two negative events occurred in the steel field: the death of Emilio Riva and the blast furnace shut down at Lucchini Piombino. After the recent deaths of Luigi Lucchini and Steno Marcegaglia, another great entrepreneur left us. This is the end of an industrial period, which characterized the growth of the steel industry in Italy.

Emilio Riva opened his first electric oven in the fifties, followed in the later years with the first billet concast. During the mid-nineties the Riva group jumped at the highest level with the purchase of the Ilva companies. The story of the Riva family had a dramatic epilogue in 2012, when the patriarch had been joined by an order of detection under the investigation of the Prosecutor of Taranto for pollution and environmental disaster. He drove the family business as a true captain of industry. All the operators of the steel field recognize his moral strength and charisma. Going back to Lucchini Piombino, unfortunately after very long and unsuccessful tentative to sell the steel mill by the Government Commissioner, the blast furnace n. 4 has been shut down on the 24th of April, to remain idle for at least 25 days more. It seems the inevitable end of the hot steel production in Piombino, well known as the location where the Etruscan started the steel production in the remote past. It is a strong signal of the suffering of the European steel makers, who have to face the overcapacity matters in the shortest future, passing through a strong restructuring of the entire steel chain stakeholders.

The April Italian scrap market has been driven by the Turkish mills purchases with the result of higher prices during the first half of the month. The Italian buyers settled their orders with the usual European suppliers by price increase around 10€. On the domestic market the prices moved up during the first two weeks up to 10€, and than they remained stable. Due to the several weekday holidays many electric mills cut or reduced the production from the 20th April to the 4th May, influencing the scrap monthly consumption. The deliveries by trucks and wagons have been regular, according to the contract, even if limited by the few monthly working days available. The arrivals at the Italian ports have been lower than last month: abt 21 Kt for scrap, abt 115 Kt for pig iron and abt 24 Kt for HBI. Mills inventories are now at better level than before. The long steel products benefited of abt 20/30€ pmt price increase.

Following the April official average prices reported (€/pmt delivered):

New arising E8:
Italy 285
France 290
Germany 290

Shredded E40:
Italy 290
France 290
Germany 290

Demolition scrap E3:
Italy 265
France 265
Germany 265

For May contracts it is foreseen a more stable situation, with only small possible downward movements,influenced mainly by the lower activity on the market of the Turkish buyers. Nothing new about the Ilva Taranto, as the new business plan has not jet been presented to the Italian Government for the final approval.

PIG IRON – H.B.I.

Standard is the volume of the pig iron arrivals reported: consequently inventories at ports and mills are always well recovered. The Russia / Ukraine issues did not influence the deliveries from the Black Sea ports. The last pig iron offers are quoted around $410/415 pmt CIF for May/June shipment. Only few settled contracts are reported but at lower prices than the last ones offered. The few quantity of HBI received in April has been delivered from Libya. The Venezuelan HBI is always out of the market and from now also the Omani HBI. Last offers are reported unchanged, around $ 360/365 pmt CIF Italy.

Source: Alocci Rappresentanze Industriali