Day: 26 May 2022

Domestic prices for cold-rolled and hot-dipped galvanized coils in Northern Europe have fallen in the week to May 25 due to poor demand, but the downtrend is likely come to an end soon, market sources said.

In Northern Europe, Platts assessed CRC at Eur1,100/mt ex-works Ruhr, down Eur10/mt on the day and Eur100/mt on the week.

Demand for CRC has been weak due to lower production rates of carmakers, caused by a continuing shortage of components. As a result, delays have been done sporadically for minor tonnages, with mills ready to give substantial discounts in special cases.

Offers and achievable prices were heard at Eur1100/mt ex-works Ruhr. One Benelux source said that deals for CRC were done at Eur1,030-1,040/mt ex-works Northern Europe, but the information was not widely confirmed in the market.

Platts assessed HDG in Northern Europe at Eur1,1150/mt ex-works Ruhr, down Eur75/mt on the week.

Market participants estimated achievable prices at Eur1,120-1,200/mt ex-works Ruhr, while offers were heard at Eur1,150-1,200/mt ex-works Ruhr. One source reported deals at Eur1,150/mt delivered Benelux, making it the equivalent of Eur1,130/mt ex-works Northern Europe.

The negative trend, which settled in the market for about two months now, might come to an end, as import offers have stopped declining. With anticipated restocking and some EU producers planning to stop galvanizing lines for maintenances, domestic supply was reduced.

“I think June will bring some movement in the market, as buyers need to finally book and plan for the period after summer,” a German trader said.

“The mills have July-August delivery, but in fact, deals are mainly done for smaller tonnages for September delivery, as buyers have started to plan their stocks for autumn,” a Northern European service center said.

The introduction of export duties for steel in India, alongside some price stabilization in Asia, is expected to support domestic prices in Europe.

“Exporters are planning price rises for Europe after India introduced export duties on finished steel,” a distributor said.

In addition, three steelmakers – one in Germany and two in Benelux – were reported to be planning to close their galvanizing lines for scheduled maintenances this summer.

The situation in the south of Europe has been similar, but no transactions were heard this week.

Platts assessed CRC at Eur1,090/mt ex-works Italy, down Eur10/mt on the week. Achievable prices were reported at Eur1,050-1,100/mt ex-works Italy.

Offers of CRC from Japan were heard at $1,050-1,060/mt CFR Italy, the equivalent of Eur978-988/mt CFR Italy. The exporter refused to give discounts and claimed that it would be able to sell in alternative markets at higher prices.

Platts assessed HDG in Southern Europe at Eur1,150/mt ex-works Italy, unchanged on the week. Market sources estimated achievable prices at Eur1,150/mt ex-works Italy, while offers were heard at Eur1,150-1,200/mt ex-works.

— Maria Tanatar, Benjamin Steven

Market participants in the EU hot-rolled coil market reported a slow-down in the recent pricing free-fall May 25 alongside a softening in downward pressure from the import market.

Hot-rolled coil in Northern Europe was down Eur5 May 25, assessed at Eur1,050/mt ex-works, according to S&P Global Commodity Insights data.

Both buy- and sell-side sources confirmed Eur1,050/mt ex-works as a tradable level for the day, although transactional activity remained muted against the recent pricing downtrend.

“There are no deals done in the market now – but buyers are starting to realize they’ll need to make bookings,” a trader source said.

Sources continued to indicate buyers to return to the market in June to reserve material for the September period.

“June should bring some movement in the market as buyers will finally need to book and plan for the post-summer period,” a second trader source said.

No import offers have been heard since India introduced new export duties, although sources expected new indications from foreign mills to be higher. Imported HRC into Northern Europe was assessed stable at Eur900/mt CIF Antwerp.

“Extremely cheap import offers are no longer available, while it may be too early to talk about a price rise, we’ll definitely see some kind of stabilization,” the same trader said.

A mill source agreed with the sentiment, expecting stabilization in the import market to present a price floor in the European market.

“The market is up and down, I’d expect new Indian duties to give a floor to pricing in the EU market, alongside [coronavirus] recovery in China, but demand uptick is still low,” the mill source said.

The source saw HRC prices hitting the pricing floor in the near-term, but stressed that potential natural gas stoppages from Russia and general inflation could influence a rebound in flat steel prices.

In the Italian market, import prices rebounded somewhat May 25, with some Indian mills heard to have suspended negotiations following the recent introduction of export duties.

Prices from Japan, alongside other Asian exporters, were heard higher on the day at $950-960/mt CFR Italian ports. A third trader reported mills were refusing lower pricing, preferring to cancel allocations to the bearish European market.

Indications for the domestic market remained relatively stable on day, with offers reported at Eur1,000/mt ex-works and sources regarded tradable values at Eur980-990/mt ex-works Italy.

Platts assessed HRC in South Europe stable on day at Eur990/mt ex-works Italy.

— Benjamin Steven, Maria Tanatar