The spread between rebar prices quoted in the respective domestic markets of Germany and Italy is at its widest in years.

In comparison with the typical spread of €50-60/tonne ($59-71) seen summer until 2020, the respective prices now differ by €150 and more. Italian mills are having a hard time obtaining a base price close to €500/t, with deals this week dipping even further to €460-470 ex-works. By contrast, German mills can easily charge €620/t delivered, at lead times of 6-12 weeks. Individual cases of immediate delivery were heard snatching €650 and more.

But this apparent price advantage does not mean Italian mills and German buyers are chasing each other for business. “The two markets work pretty separately, and Italian deliveries only make sense to the far German south,” a manager tells Kallanish.

Although his company is located in southern Germany, he normally does not go for rebar from Italy, he says. In his mindset, Italian mills traditionally serve different markets, like in Southeast Europe, with little overlap to the German market. Another factor is the better portfolio range of German mills, which German buyers rely on. “And you cannot go cherry-picking, ordering straight standard bar from there, and coil etc. from here; it does not work like that,” he says.

Also, Italian mills offer different prices for customers abroad. Italian offers to customers in southern Germany were last reported at €585/t for standard length, 12m base delivered, according to another German observer. “And if you need to go further north, the additional transport costs lift the price close to €600, and that’s not far off from the German offers,” he states.

Many sources point out that a shortage of transport capacities has become an issue on top of all other factors. “In Italy, they have real trouble to find trucks for border-crossing transports, especially for special sizes like 14m length and beyond,” the observer says.