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November, 24th 2020

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JUL 29

Slowing construction demand pressures German rebar price


Rebar purchasing activity from the German construction industry is slowing down, and bending shops are facing increasing price pressure, domestic market participants say.

Construction has enjoyed a prolonged period of strength in Germany, and was largely unaffected by the coronavirus in the first half of the year. But industry observers now suggest a slowdown will come with a delay. One large buyer says new projects are not coming in as they used to, which could foreshadow a drop in prices later this year.

Mills were able to lift base prices last month by some €10/tonne to around €180/t ($212). But players polled by Kallanish this week rule out the possibility of a further increase. Most, however, do not foresee a dip either, now that the through has been left behind. They argue that mills’ margins are too narrow to allow for a rebar price reduction unless scrap prices fall sharply.

Nevertheless, restrained purchasing may also see cut-and-bend buyers speculating on cheaper deals, “…because their own selling prices are quite miserable,” a source from a mill admits. In fact, a buyer from a large southern German distribution group tells of a reduction of selling prices to customers. The group was exempt from mills’ price hike that occurred some weeks ago, and stayed at the former level of €170/t.

This is also the price reported from Switzerland, which followed the hike implemented in Germany, but at a level altogether some €10 lower. In Austria, nominal domestic prices are at around €170/t, too, but with competition from Italian imports, rebar can be had for €150 (see Kallanish 28 July).

Article comments

jack liu
Aug. 4, 2020, 10:33 p.m.

Hope this is not the reason for the shrinkage of the construction industry. This will affect our ride on power trowel sales.