Steel prices in Europe fall as economy slowing down

Steel prices in Europe are falling amid slowing economy and weakening demand for products that were replenished after Russia’s invasion of Ukraine, Bloomberg reported.

Hot rolled coil price has fallen by almost a third since reaching record levels in March. Prices are currently trading below €1000/t for the first time since February.

Rolled steel quotes are declining amid a slowdown in the European economy due to higher raw material prices and rising inflation, which reduces consumption in the industry. In addition, factories and warehouses replenished their stocks after Russia’s invasion of Ukraine amid fears of supply disruptions, which reduced the need to purchase products at high prices.

A further drop in prices could dampen the profits of steel companies, which benefited from a bonus from the commodities boom that began amid the pandemic in 2021.

According to Matthew Watkins, chief analyst at CRU Group, hot rolled coil prices will fall another €100-150/t over the next two months because of weak summer demand. At the same time, prices will remain at a level that is much higher than in the previous 10 years, when the cost of rolled products often exceeded €600/t.

Earlier GMK Center reported that global scrap metal prices have been falling for the tenth consecutive week due to lack of buyer activity amid low demand for finished steel. As of June 6, quotations for HMS 1/2 grade scrap in the Turkish market were $430-435/t, down $15 from the previous week.