Day: 31 August 2022

Long steel producer Pittini Group’s Ferriere Nord has suspended work at the Osoppo plant in Italy until Oct. 2 due to high energy costs, a union source told S&P Global Commodity Insights Aug. 30.

The company had communicated to unions that it would suspend work for 751 workers at the plant from Aug. 29 to Oct. 2, a representative from the Italian Union of Metalworkers, or Uilm, said.

Energy prices have been strong in Italy and year-ahead Italian futures on the EEX exchange settled at Eur525/MWh Aug. 29, up 44% since the start of the month.

The company will suspend and/or reduce working hours and use the Cassa Integrazione Guadagni Ordinaria, or Ordinary Wage Guarantee Fund, the representative said, which is a wage guarantee tool that can be used in the case of temporary suspension or reduction of working activities.

“There will not be a total closure of plant, rather a partial,” they said, adding that there would be no dismissals within the end of the year.

Pittini did not respond to S&P Global’s request for confirmation.

The steelmaker’s Osoppo’s 2.2 million mt/year electric arc furnace was installed in September 2019 with a larger diameter to reduce energy consumption and improve efficiency of the smelting cycle, the company said previously.

Platts assessment of TSI Northwest Europe Rebar was down Eur30/mt week on week to Eur950/mt ex-works on Aug. 24.

Deals heard over the week to Aug. 24 from Italy to Germany were booked around Eur930-940/mt delivered Germany. Large European producers are targeting sharp increases in long steel prices amid a jump in energy and transport costs.

— Jacqueline Holman, Viral Shah

European hot-rolled coil (HRC) prices sank deeper in the week to Friday August 26 amid limited demand and persistent overstocking. Nevertheless, ArcelorMittal increased its offers to reflect surging costs, sources told Fastmarkets.Europe’s flagship producer, ArcelorMittal, increased its offer prices for all coil products on Friday, despite weak market fundamentals.

Its new offers of hot-rolled coil (HRC) were heard at €800 per tonne ex-works for October rolling material and €850 per tonne for November rolling, several sources told Fastmarkets. This was substantially above the most recent deals concluded in Northern Europe within the range of €700-750 per tonne exw during the previous week.

ArcelorMittal’s increase was mainly due to a substantial rise in production costs amid surging energy prices across Europe, several trading sources told Fastmarkets.

Market sources said they now expect other European steelmakers to make a similar move.

Fastmarkets calculated its daily steel HRC index, domestic, ex-works Northern Europe at €720.00 ($717.86) per tonne on Friday, unchanged from the previous day.

The latest calculation of the index was down by €30.00 per tonne week on week and down by €137.50 per tonne month on month.

Transactions for HRC in Northern Europe were reported at €700-730 per tonne exw, but for small tonnages.

Trading activity in the region has been sluggish amid persistent overstocking, poor end-user demand and an unclear post-summer price trend. Market sources were, therefore, quite skeptical about ArcelorMittal’s price rise, considering the poor market fundamentals.

Most buyers estimated the workable price for HRC in the region to be €700-750 per tonne exw.

Fastmarkets’ calculation of its corresponding daily steel HRC index, domestic, exw Italy was €705.00 per tonne on Friday, also unchanged from the previous day.

The latest calculation of the Italian index was down by €35 per tonne week on week and down by €75 per tonne month on month.

The calculation was based on buyers’ estimates of achievable prices at €700-710 per tonne exw.

As a result of summer maintenance closures, there was minimal trading activity, sources said.

Demand for HRC in the nation has also been sluggish due to overstocking and a wait-and-see attitude among buyers.

Imports

Demand for overseas coil remained slow during the assessment week.

Buyers in Northern Europe estimated the tradeable price for overseas coil at €650-670 per tonne cfr.

Long delivery times continued to be a factor driving the low number of transactions in the import market, Fastmarkets heard.

Some customers, anticipating depressed end-user consumption, were reluctant to submit orders for stock. There were concerns that they could take many months to arrive, by which time the material could be over-priced or demand for it might be very low.

Published by: Julia Bolotova

European hot-rolled coil prices moved up slightly, with increasingly more producers pushing for higher offers amid surging costs, Fastmarkets heard on Tuesday August 30.The downtrend that has persisted in the European flat steel market for the past several months seems to be coming to an end, despite still-low demand

Last Friday August 26, Europe’s leading producer ArcelorMittal increased its offer prices for all coil products by €50-100 per tonne depending on lead times.

During the week starting Monday August 29, more European mills have followed suit and announced offer price rises for flat steel products – including HRC – in the face of skyrocketing costs, Fastmarkets heard.

Notably, on August 30, Slovakia-based steel mill US Steel Kosice pushed for a €100-per-tonne price rise for October rolling HRC “as a result of skyrocketing energy prices and record-breaking levels of inflation,” the company said in a notice seen by Fastmarkets.

According to market sources, several other producers including Dunaferr and Liberty Steel have made similar moves and pushed for €70-100 per tonne higher flat steel offers.

After the price increases, HRC offers from the mentioned mills vary in a range of €850-870 per tonne delivered, Fastmarkets heard

One German producer also increased its offer price to €800 per tonne exw, sources said.

The targeted offers are still substantially above the tradeable level reported by market sources, however.

Fastmarkets calculated its daily steel HRC index, domestic, ex-works Northern Europe at €735 ($732.81) per tonne on Tuesday, up by €15 per tonne from the previous calculation of €720 per tonne exw on Friday. Fastmarkets’ HRC indices were not updated on Monday due to a UK public holiday.

The latest calculation of the index was up by €12.60 per tonne week on week but down by €121.25 per tonne month on month.

Several trading sources estimated the workable level for HRC in Northern Europe at €720-730 per tonne exw, but one transaction for a small volume of HRC was reported at €750-760 per tonne exw in the region this week.

In general, trading activity in the region has been sluggish amid persistent overstocking; however, several mills reported an increased number of inquiries from buyers.

“Everyone is checking to understand the price direction, but the activity is still weak,” a source in Germany said.

“It is too early to speak about the price rise. Without reasonable demand, it won’t be possible to achieve higher prices,” a mill source told Fastmarkets.

Fastmarkets’ calculation of its daily steel HRC index, domestic, exw Italy was €716.67 ($714.54) per tonne on Tuesday, up by €11.67 per tonne from the previous calculation on Friday.

The latest calculation of the Italian index was down by €0.83 per tonne week on week and down by €63.33 per tonne month on month.

The calculation was based on buyers’ estimates of achievable prices at €700-740 per tonne exw.

Most of the market participants in Italy were still out of the market due to the summer holiday period, so activity was minimal. Sources expect Italy’s HRC market to fully restart from holiday mode next week.

However, sources agreed that Italy’s mills will also attempt to push for higher prices to reflect surging energy costs.

In fact, one integrated steel mill in the nation has already pushed for a €100-per-tonne rise, with other two flat steel makers in the nation expected to make similar moves.

New HRC offers in the nation are expected to be about €800 per tonne exw, several sources told Fastmarkets.

Published by: Julia Bolotova