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[Ferro-Alloys.com] According to market sources, Italy's steelmakers have not yet made any production cuts due to the virus and steel shipments have not been impacted.
"We are still producing with no problems, but the overall demand picture is not brilliant and there is the uncertainty that if any single employee is confirmed to be infected with the virus, then authorities could shut down a mill very quickly under quarantine," a source explained.
A Switzerland-based service center buyer said that he did not yet see any impact on shipments to Switzerland from northern Italy.
"There are no restrictions in sight regarding trains [as there has been to Austria], however most of our steel comes to us by road freight from our Italian suppliers," he said.
Arvedi, the second largest Italian flat steel producer, based in Cremona, is not far from the so called "hot spot" area where the virus has been confirmed, but sources said that the steel producer is working as normal. Arvedi did not respond to Platts inquiries about this matter.
"We are still buying from Arvedi, but they are located close to the coronavirus hot spot. If they will stop producing this will be a problem especially when AM Italia, the largest producer, is operating at a reduced capacity," a source from an Italy-based service center said.
Hot-rolled coil basis EXW Italy was assessed at Eur456.50/mt Monday, while imports into Italy have been very limited in recent weeks as steel producers in Turkey, India and beyond have secured better prices in their home markets. HRC was heard available basis CIF Italy ports on Friday at Eur480-490/mt from Turkish steel mills.
In Italy, a recovery of scrap prices also seems difficult, amid weak domestic Italian rebar prices with sales heard at Eur420-Eur425/mt DDP Italy, while export Italian rebar sales were heard at Eur410-Eur415/mt FOB.
"Due to the relative slowdown in activity in the Turkish scrap markets and the weak demand for Italian finished steel, it will be difficult to see a recovery in scrap prices, in particular should Arvedi stop production due to coronovirus, this could further increase the supply of scrap and limit a rebound in prices," a source commented. Arvedi produces flat steel using EAFs, so is one of the largest Italian scrap buyers by volume. (S&P Global Platts)
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