According to Platts' December steel sentiment survey, German steel prices are expected to show a steady improvement in the coming weeks as trading is expected to remain slow.
Uncertainty regarding the automotive industry and the sector's increase in steel volume will remain on the agenda until 2022. Although the latest cautious positive signals from the auto industry for January and February have lifted the mood at steel mills a bit, German mills still have extra volumes. Sales that were not undertaken by the auto industry this quarter are putting pressure on spot price levels.
Slow trading conditions in December
Trading is generally slow in December and sources have signaled that this will be the case by mid-January, given the current market environment with uncertainty about short-term movements. This also means that stocks may remain at their current levels, as most do not increase their stocks with spot purchases before the end of the year and only do back-to-back business. Steel service centers and their shareholders said they expect some material to arrive in warehouses from previous pre-orders, and they won't need that much material in January and February.
The latest data from the German shareholders' association BDS showed that stocks, including long and flat steel, reached 2.18 million metric tons in October for shareholders. (this is the highest level in about two years)
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