At a meeting this week, the local steel trade association Assofermet warned that demand remains sluggish but processing costs are rising simultaneously.
Alessandro Bettuzzi, coordinator of Assofermet's stainless steel service centers division, said: "We continue to see a reduction in demand on the one hand, and on the other we continue to see requests for increases from steelmakers. From the steelmakers' point of view, the first half of 2023 was generally positive, both in terms of production volumes and margins. As for steel users, they are currently operating in an even more volatile situation due to the difficulties of planning and scheduling purchases. The inflationary effect as well as the great uncertainty in the current market makes them extremely cautious both in terms of stainless steel consumption and investment."
The association warned of the danger of green steel and decarbonization creating two parallel markets: a high-end market of products driven by sustainability policies and a consumer market with more affordable prices.
The Italian stainless steel market for both long and coils has seen a sharp slowdown this year. Steelmaker Acciai Speciali Terni, part of Arvedi, has carried out several production shutdowns due to a contraction in sales volumes. Italy's stainless flat steel demand remains fragile on the downside.
Despite a slight increase in coil sales in September and October, service centers and re-rollers were not able to pass on the price increases downwards. Inventories remained at medium-high levels. The market for service center customers is slow and unable to absorb price increases. Sheet values are at the same level as producers' coil levels, so these prices are not sustainable.
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