Day: 20 January 2022

European HRC prices on Jan. 19 were little changed in Northern Europe at Eur940/mt ex-works Ruhr, as a decline in Italian HRC prices widened the regional spread.

The spread between NW Europe and Italian ex-works HRC prices widened by Eur10/mt to Eur110/mt on the day, as the Platts HRC ex-works Italy assessment fell to Eur830/mt ex-works.

HRC prices looked stable from year-end in a Eur820-Eur830/mt ex-works Italy range, a trader said, noting larger volumes would be bid at lower prices. Delivered HRC pricing may be Eur840-Eur850/mt in Italy from local producers who may be able to accommodate shipments as early as February, another local market source said.

The market showed some hesitancy to book volume at offer levels, and higher availability, especially for HRC, was talked about across supply chains and for imports.

Buyers were looking to assess stocks at suppliers, service centers and at ports, and gauge changes to import pricing ahead of the Lunar New Year, a trader said.

New price offers by European mills are reportedly yet to find much traction, with one source citing a failure to secure any increase in Germany.

Another participant urged caution, seeing more time for offers to be defined across more producers and see feedback.

Import HRC and CRC prices edged lower, taking into account weaker purchasing sentiment in the run-up to the fiscal year with available forward offers.

Indications were seen to book March HRC production from Asian steel mills in a low-to-high Eur700/mt CIF range, depending on origin. However, deliveries would take well into the second quarter.

Indian HRC offers were heard at Eur730-740/mt CIF Europe, and $720-$730/mt CIF Italy, for material arriving well beyond the 6-12 week forward delivery window used for Platts import HRC assessments. Japanese and South Korean HRC pricing were higher, with Chinese HRC heard offered at $750/mt FOB.

For CRC, new import prices were indicated at Eur860/mt-Eur900/mt CIF Europe, for March shipment from Asia.

European CRC prices were said to be around Eur1,050/mt ex-works for March or April delivery.

“I don’t have very positive expectations,” a trader said of the flat steel market.

“Last year it was totally different. There was strong restocking and strong automotive demand. The situation is different now.”

He said HRC stocks in Western Europe were high, and similarly for hot-dipped galvanized steel, limiting restocking demand in the short term.

Heavy plate markets was said to see more potential trade, due to relatively low stocks. Plate of Indonesian origin was heard traded at Eur810/mt CIF Antwerp, April delivery.

— Hector Forster, Wojtek Laskowski

The US and UK officially began bilateral discussions Jan. 19 to address global steel and aluminum excess capacity and a tariff dispute between the two nations.

“The distortions that result from this excess capacity pose a serious threat to market-oriented steel and aluminum industries in the US and the UK, and to the workers in those industries,” trade representatives from both nations said in a joint statement.

The statement was issued following a meeting involving US Commerce Secretary Gina Raimondo, US Trade Representative Katherine Tai and the UK Secretary of State for International Trade Anne-Marie Trevelyan.

Regarding trade between the two countries, the representatives agreed to resolve issues stemming from the US’ Section 232 steel and aluminum tariffs on imports from the UK and the UK’s retaliatory tariffs on certain US exports.

“[The trade representatives] agreed that, as the US and the UK are close and long-standing partners, sharing similar national security interests as democratic market economies, they can partner to promote high standards, address shared concerns and hold countries that practice harmful market-distorting policies to account,” the statement said, adding that overcapacity in China particularly posed a threat to the global market.

The trade representatives will seek a prompt resolution to address global excess metal production capacity and the “deployment of effective solutions, including appropriate trade measures, to preserve our critical industries,” according to the statement.

The US began talks with other world governments in 2021 concerning overcapacity and trade disputes in the steel and aluminum industries. In October, the US modified its Section 232 tariff program to allow a certain volume of metal shipments from the EU to enter the US duty-free under a quota.

The Section 232 tariffs were imposed on most countries in 2018 under former President Donald Trump.

Italian rebar contract prices are continuing to tick up, confirming the slow upward trend that started at the beginning of the month, market participants tell Kallanish.

Local producers are now quoting at €580-590/tonne ($657-669) base ex-works, mostly due to high energy and transport costs. Today’s contracts for low tonnages range between €540-570/t base ex-works. Including size extras, domestic values are now at €800-830/t ex-works, sources suggest.

Demand however remains weak and deals are done only back-to-back for relatively small tonnages. While public infrastructure projects are absorbing the increases, the private residential sector is slowing down most new projects due to uncertainty and the latest wave of Covid-19, distributors say.

According to national statistical institute Istat, in October 2021, the construction industry registered a growth of 0.8% compared to the previous month. In the first ten months of last year, the sector grew 25.5% compared to the same period in 2020, Kallanish notes.

Natalia Capra France