Crude steel production in Germany was down by 24.70% year on year in July due to capacity being cut to balance the drop in demand caused by the Covid-19 pandemic, German steel federation WV Stahl said on Monday August 24.
Germany's crude steel production totaled 2.42 million tonnes in July 2020, down from 3.22 million tonnes in the corresponding period of 2019.
The July 2020 output is close to the lowest point in production in Germany reached in the first half of 2009, when July output was 2.40 million, WV Stahl said.
A number of European steelmakers stopped equipment or slowed production due to the demand slump during the Covid-19 lockdowns across Europe and output still remains reduced despite lockdown restrictions being eased, market sources said.
Steel output from German basic oxygen furnaces (BOFs), which is mainly used in the production of flat steel products, dropped by 29% year on year to 1.67 million tonnes in July.
Fastmarkets'
daily steel hot-rolled coil index, domestic, exw Northern Europe, was calculated at ?,?433.75 ($511.60) per tonne on Friday August 21, up by ?,?1.87 from ?,?431.88 per tonne on Thursday.
The index - which was based on deals and achievable prices heard at ?,?430-440 per tonne ex-works - was also up by ?,?14.58 per tonne week on week and up by ?,?26.08 per tonne month on month.
One big steelmaker has increased its offers to ?,?500 per tonne ex-works this week, but this price was not included in the index after buyers deemed it "unworkable." The high offers, however, showed that steel mills will insist on higher prices for HRC as soon as market activity recovers, which is likely to be in late August or early September, sources told Fastmarkets.
The HRC price recovery is
mainly being driven by reduced output from domestic mills combined with lack of competitive import offers, market sources said.
Germany's crude steel output from electric-arc furnaces (EAFs) declined by 13.10% year on year to 758,000 tonnes in July. EAF-route steel is mainly used to produce long steel products.
Fastmarkets'
weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Northern Europe, was ?,?450-460 per tonne on August 19, with lower end of the range up by ?,?10 per tonne month on month.