The latest MEPS report summary
US steel producers have put aside the proposed price increases for the last quarter against a background of weak demand and falling scrap costs. With customers holding back orders some price slippage has been recorded. Prices fell in August and September in Canada and further price erosion can be expected.
China saw price reductions in August and demand continues to be weak, whilst the Japanese market remains relatively strong, other than in the construction sector.
Demand in Europe remains weak but the mills appear resolute in maintaining price levels achieved so far this year. At this time the producers seem inclined to reduce capacity rather than prices.
read the full report here.
Whilst the mills continue to be "bullish" and relatively upbeat in their forecasts, we have seen spot prices slipping in Europe and would anticipate further pressure coming from imports as the year goes on. I cannot help but think that even the "best" endeavours of the steelmakers will be insufficient to stop further price falls. Whilst we are unlikely to go back to the wild fluctuations of the past few years, an unprecedented "fall off" in demand tied to the global economy is inevitably going to have a downward impact on prices.
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