Italian Hot Rolled Coil Price Observed Rising Trend Amidst Strong Demand from Construction Industries
Italian Hot Rolled Coil Price Observed Rising Trend Amidst Strong Demand from Construction Industries

Italian Hot Rolled Coil Price Observed Rising Trend Amidst Strong Demand from Construction Industries

  • 12-Jan-2024 2:17 PM
  • Journalist: Li Hua

At the closure of 2023, the Italian spot market observed a surge in price for Hot Rolled Coil as the demand from the downstream construction sector remains bullish. The macroeconomic factors such as the lower inflation rate strongly backed the optimistic market trend in Italy. Meanwhile, regarding manufacturing industries, one of the largest steel plants in Europe, Acciaierie d'Italia (ADI), formerly known as Ilva, has been in a critical situation with fear of low cash. The Italian government is planning to support the plant by requesting ArcelorMittal to consider the acquisition of the plant’s controlling stakes. The buyers were placing healthy orders, keeping the Hot Rolled Coil market on a notable rising trend.

In December, the consumption rate of Hot Rolled Coil was observed to be on a higher edge as the end-use construction industries have been on a bullish trend. The residential construction rate has surged in Italy as Italy's government has planned to agree on a limited extension of costly "super bonus" subsidies for home improvements, resulting in a surge of Hot Rolled Coil demand. Economy Minister Giancarlo Giorgetti announced that the total cost of the super bonus scheme will top USD 111.25 billion by the end of this year. Moreover, concerning economic factors, the inflation rate slowed down to 0.6% in December 2023, after the government's anti-inflation plan came into force, according to the Italian National Institute of Statistics (ISTAT). In the recent national address, Italy's Prime Minister, Giorgia Meloni, expressed confidence that the Italian economy is poised to surpass that of the entire European Union by 2024. This optimistic outlook is expected to have a positive impact on the Italian spot market for Hot Rolled Coil.

Meanwhile, the major manufacturer of Hot Rolled Coil across Europe, Acciaierie d'Italia (ADI), Ex-Ilva, has faced a deteriorating phase for months and is now in a condition of closure. The previously plunging market of Hot Rolled Coils and other steel products across Europe led to its declining trend. The increase in energy prices and a drop in Hot Rolled Coil prices previously resulted in a long shortage of cash for the plant. The plant authority had to take debts from the major market player, along with a major energy giant, Eni S.p.A. The debt piled up and has now forced them to shut down their operations. ADI directly employs 8,200 people at a huge steelwork in the southern city of Taranto and unions are urging the government to safeguard jobs. Therefore, the Italian Government has reached out to Arcelor Mittal, the major manufacturer of Hot Rolled Coil, to acquire the ADI’s controlling stakes as the plant already had 68% of its shares.

According to ChemAnalyst, the price of Hot Rolled Coil is anticipated to remain on a surging trend as the Italian government's upcoming plans and strong downstream demand keep the market bullish. The trade disruption is keeping inventories scarce, leading to a boost in Hot Rolled Coil prices in the European market.

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