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Northern European Business Activity Remains Lethargic, As The Summer Holiday Period Approaches

Hot rolled coil demand, in Denmark, is better than in many other European countries, but shows little sign of improvement. Swedish business activity is quite steady, having recovered from a downturn during the spring. Cheap Russian slab supplies put downward pressure on coil values, in Finland.

Demand is healthy, in the Netherlands and market participants believe that the bottom of the current price cycle has been reached. Construction activity is strong, in Austria, but, in other sectors, consumption is poor. Purchasing activity is at a low level, in Norway.

Quarterly contract prices for hot rolled plate decreased, slightly, in Finland. Market participants in Denmark express uncertainty, regarding the short-term future. Swedish domestic prices are stable. In the Netherlands, demand from agricultural equipment makers is steady, but shipbuilding activity is subdued. Sales to machinery makers are below projected volumes, in Austria. Activity is reasonable, in Norway.

Delivery lead times, for cold rolled coil, from EU producers, are shrinking. Demand in Sweden is stronger than in most EU countries, but the weak national currency is putting a strain on production costs. Local consumption is fair, in Denmark. In Finland, activity is slowing. Demand is healthy, in the Netherlands, but competition, between European suppliers, is stiff. Low-priced quotations from Eastern Europe are undermining attempts to raise prices, in Austria. Market conditions are quite poor, in Norway.

Hot-dipped galvanised coil sales, in Denmark, Sweden and Finland, are still being affected by the downturn in the auto industry. Sales volumes are acceptable to steel producers, in the Netherlands, but supply is plentiful. In Austria, sales for building-related applications are quite healthy. Purchasing, by traditional end-users, is modest, in Norway.

Demand for wire rod is quite stable, in Sweden. Producers have difficulty in maintaining selling values, under the influence of the weak European market. In Finland, buyers achieved a small cut in prices from EU producers, while Russian suppliers raised their offers. Transaction values in the Netherlands, Austria, Norway and Denmark reduced.

ArcelorMittal’s plan to reduce output of medium sections and beams has, so far, failed to boost prices. Activity is slowing, in the Danish building industry. The commercial construction sector is quite busy, in Sweden. A lack of new projects is stifling consumption, in Finland. Demand from the building sector is robust, in the Netherlands. Austrian domestic activity is fair. Transaction values, in Norway, are under negative pressure.

Sellers will struggle to lift prices for reinforcing bars until Turkey’s EC import quota has been filled. Demand increased, in Sweden and Denmark, before the summer slowdown. Finnish domestic demand is at a similar level to that of one year ago. Local mills are busy, in the Netherlands, but plenty of competition exists. Sales volumes are fair, in Austria, notwithstanding the negative effect of the summer vacation period. Norwegian domestic demand was at a satisfactory level.

Danish industrial activity is quite healthy, but EU producers of merchant bars are recording subdued sales in Western Europe. Regional producers attempted to raise selling figures, in Finland, but they were undermined by reduced scrap values and weak activity. Demand is fair, in Sweden and consumption is reasonable, in the Netherlands, but stockists’ profit margins are being eroded. Bar values, in Austria, are affected by weak fundamentals in the wider European market. Transaction figures, in Norway, were unchanged.
Source: MEPS

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