Good news for the European steel market, which has started 2011 with encouraging signs that raise hopes for the future.

The report by EUROFER, i.e. the European Confederation of Iron and Steel Industry, announced positive forecasts for the first quarter of the year.

In the last half of 2010 the sector's growth has been steady but slow; however, the estimated figures for 2010, which forecasted an increase of 2% of the GDP, have turned the discrepancies and the several differentiations existing in different countries into economic results.

On the one hand, Germany and the North-Easterly countries have become the leaders of a strong recovery, whereas other European nations are making slow progress, due to the weakness in exports and the negative impact of the measures of "austerity" imposed by local governments on domestic demand.

According to Eurofer the good news comes from the manufacturing sector: improving the capacity of the plants can trigger and increase investments in machinery and equipments.

The rebound in industrial production has replaced restocking as the key to the growth of steel consumption by mid-2010 onwards.

By registering the positive opening of European steel market, Eurofer states however that "inventory levels of end users and distributors are still medium-low in relation to the activity of end supply chain. The import sector has not yet reached the levels of the period 2006-2008, although the plans one is growing rapidly. Summing up, the forecast for the real and apparent steel consumption growth is sustainable, assessable at 4% per annum in 2011 and 2012".