Flat steel prices in Central Europe are increasing despite weak end-user demand and sluggish distributor buying activity.
Manufacturing PMIs of both Poland and the Czech Republic are in the contraction zone due to high inflation and increasing input costs, leading to the bankruptcy of several businesses. Decreased steel import volumes increase supply tightness, causing steel prices to increase.
Increasing demand from neighboring countries with better economies also affects the value of steel products sold in the Polish and Czech markets. While domestic prices are increasing, new overseas offers are becoming increasingly attractive to domestic buyers and additional regional supply is coming into play again. However, the overall activity levels in the Central European steel market are expected to remain low with the restriction of stock purchases. Concerns about decreasing prices are shared by steel buyers in the EU, but limited supply is likely to keep prices high in the near term.