European steel prices continue to fall

The EU mills continue to curb capacity but many market players question whether the cuts are sufficient. Distributors are still destocking because sales to end-users are so poor that the whole process is taking much longer than anticipated. Credit issues are exacerbating an already dismal demand situation. The producers have held back from making official announcements for the second quarter. They lowered prices for March output, amidst weak demand, financial uncertainty and severe competition for the small amounts of business that were available. German consumption remains subdued with no signals that any improvement is on the horizon. Distributors are finding it hard to reduce inventories due to dreadfully low sales. Basis values continue to dip slightly. It is difficult to establish a market level since each mill makes its own price, depending on quantity and how few orders they have on their books