Entering March: German Galvanized Plain Sheet Prices Drop Amid Economic Woes

At the start of March, the price of the Galvanized Plain Sheet experienced a decline in price trend as the demand from the downstream construction and automotive industries descended. The rising economic concerns amidst the weakening economy in Germany had incited buyers to remove from trading in the German market. Meanwhile, manufacturing activity has shown a significant decline in February, leading to a decline in the consumption rate of Galvanized Plain sheets in the German spot market. The auto sales showed firm growth, but the production rate fell in the German spot market in the entering March 2024.

The primary concern lies in the deteriorating economic conditions within the German market, which present a significant challenge to the increasing demand for Galvanized Plain Sheets. The persistent high electricity costs have emerged as a barrier, rendering Germany's manufacturing sector less competitive on the global stage. The German manufacturing activities has been dull since January and was expected to remain on a dwindling trend in February as construction activity plummets in Germany. While there's a modest rebound in inflation rates, primarily due to a gradual easing of energy product prices, there's cautious optimism for a potential recovery shortly. Then again, the cost of shipping a Galvanized Plain Sheet remains prohibitively high, exceeding pre-existing levels by over 150% since the Red Sea security crisis prompted vessels to bypass the Suez Canal. Although there's been a gradual decline in shipping costs since late January, the situation remains volatile and unpredictable, with freight rates fluctuating unpredictably. Moreover, the Red Sea crisis has extended lead times for transporting steel from Far Eastern countries to Europe by an additional 15-25 days, surpassing the previous duration of 30 days. This extended lead time further compounds logistical challenges and underscores the complexity of the current supply chain landscape for the German Galvanized Plain Sheet supply.

Decreased end-user interest and a notable influx of low-cost imports from Asian suppliers of China and Vietnam have persistently driven down prices for Galvanized Plain Sheets in the German spot market. Domestic buyers proceed with caution, refraining from restocking due to diminished demand in the construction and automotive sectors. Major market players for Galvanized Plain Sheet suggest that the market's subdued activity has prompted speculation about mills reducing output. However, some argue that producers might maintain current levels due to limited interest in imports.

According to ChemAnalyst, the price of Galvanized Plain Sheet is anticipated to show a declining price trend as the rising import induced pressure on the local market price. Furthermore, the deteriorating demand from the weakening auto and construction sector in Germany is expected to play a major role in lowering future price trends for Galvanized Plain Sheets.