Rising prices for rolled metal may lead to a halt in sales in the EU

Buyers of rolled steel are considered largely defenseless in the face of continued price increases, but there are signs that they may simply stop buying at some point.

In particular, for hot-dip galvanized coils, which the market leader now quotes ex-works at more than € 1,100 per tonne (US $ 1,325), the problem exceeds the price.

According to one German distributor of galvanized sheet, “The third quarter is already so crowded that even the fourth is considered sold out, with the exception of small orders. It looks like we can stay at home in the second half of the year. "

“So far, demand has remained high, as has the willingness of buyers to pay high prices,” he says to Callanish. But he further says that "the likelihood that orders will fall in the second half of the year is 90%." Refiners and marketers will soon be reluctant to stay in the game, cut production and stop ordering steel. “Currently there are still orders. but they are no longer profitable, and soon people may just stop doing business, ”the distributor said.

A similar warning came from the Benelux, where "a shortage of materials, extremely long delivery times and insanely high prices could force large consumers to cut or even temporarily halt production," says the manager.

He criticizes EU politicians for even considering increasing import duties in this situation, when consumers are faced with a price increase of up to 50-75%. “If steel consumers decide to massively reduce their production, this could lead to significant staff reductions, which cannot be the goal of European economic policy,” he says.