Polish steel demand remains bullish

In Poland, demand for steel sheet and coil remains strong. Material shortages and extended mill delivery times continue to be a challenge for buyers. In addition, restricted credit limits are becoming a stumbling block for increased purchases. Domestic flat product transaction values are rising steadily, in line with global prices.

Despite all the above challenges, the IHS Markit Poland Manufacturing PMI climbed, in February. It accelerated to 53.4, from a figure of 51.9 recorded in the previous month. This signals an increase in output growth and points to a steady improvement in manufacturing conditions.

Order volumes at the steel mills are strong. Bookings for cold rolled and coated coil products are now into the third quarter. Spot availability is limited and at an extremely high premium.

Activity in the Polish long products sector is less impressive but is satisfactory. Prices have stabilised or softened slightly, due to an earlier decline in raw material costs. This is viewed as a temporary situation and steel transaction values are expected to increase shortly. Inventory levels are reported to be adequate, with delivery lead times stabilising.

Tight supply pressures Czech market

From a high point of 57.0 in January, the IHS Markit Czech Republic Manufacturing PMI slipped to 56.5 in February. Output by manufacturing companies slowed, due to shortages of input materials and other problems in the supply chain.

Flat steel product inventory levels, which are under pressure, in conjunction with increased prices, are creating a difficult situation for buyers. The poor availability of material continues to exert undue strain on the industrial sector. Nonetheless, most Czech businesses are predicting a strong second quarter.

Service centre activity, particularly that linked to the automotive sector, is very buoyant. The white goods industry is healthy, while the construction sector remains steady.