Northwest European domestic hot-rolled coil prices moved up on Nov. 17, driven by distributors’ need to replenish stocks.
The real demand, however, remained limited, and market participants had largely bearish outlook for steel consumption for 2024.
“Currently distributors are restocking, but the volumes are limited due to negative outlook for real demand in the first and second quarter of 2024,” a service center source said.
Meanwhile, another service center source said mills were in position to push for higher prices.
“Many buyers want to book as they had been avoiding booking for a long time, some for too long and now they have to pay higher prices as otherwise they would end up with empty stocks,” the second service center source added.
The majority of deals were concluded at Eur660-680/mt ex-works Ruhr, with some larger volumes booked at Eur630-640/mt ex-works Ruhr.
Platts assessed the price of domestic hot-rolled coil prices in Northwest Europe up Eur10 on the day at Eur665/mt ex-works Ruhr on Nov. 17.
“There are some flagship deals done for smaller volumes and higher prices and mills use them as a reason to push prices up,” a mill source said.
A couple of market sources said that steelmakers were preparing to further increase offers targeting prices above Eur700/mt ex-works Ruhr for the first quarter delivery.
Mills have also been pushing spot prices up to have more leverage in long-term contracts negotiations for 2024, sources said.
Platts assessed domestic prices for hot-rolled coil in South Europe down by Eur5 on the day at Eur645/mt ex-works Italy on Nov. 17, reflecting tradable values reported at Eur640-650/mt ex-works Italy.
Europe-based buyers have been showing limited interest in HRC originating from Far East due to longer lead times, as the material ordered now would be custom cleared in the second quarter of 2024 in order to fit into quotas for other countries.
Some deals, however, have been settled for the material from Turkey and India due to shorter lead times and country-specific safeguard quotas, which were not filled for January-March 2024.
In Southern Europe, deals for HRC from Turkey were heard at Eur630/mt CIF Italy, including anti-dumping duties. Deals for HRC coming from India were also heard at the same price level.
Platts assessed the import price of hot-rolled coil in South Europe up Eur10 on the day at Eur630/mt CIF Italy on Nov. 17.
Authors: Maria Tanatar, Rituparna Nath
Mills looked to increase offer prices in early November, but these price rises have not been accepted by the market.
Participants remained uncertain of the price trend for the remainder of the year.
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar) domestic, exw Italy was €600-620 ($652-673) per tonne on Wednesday, stable from November 8.
Slow demand resulted in thin trading in the Italian rebar market, sources told Fastmarkets.
Most sources expect small price rises in the coming weeks, given high feedstock costs and production cuts.
Workable prices were reported by buyers at around €600-610 per tonne ex-works, while offer prices were closer to €620 per tonne ex-works.
“The price in Italy now is stable at around €610 per tonne for rebar. The forecast for next week is probably €620 per tonne ex-works. The market is still flat but costs, like scrap and electricity, are increasing,” a buyer source said.
“Demand is low these days and customers don’t believe in price rises. Mills will look to raise prices to €620-630 per tonne ex-works before the Christmas holidays, but whether these offer prices will be realized remains to be seen,” a trader source said.
“The price of the steel is stable and market conditions are stable at the moment,” a second buyer source said.
At the same time, Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered, Spain was €590-615 per tonne, also unchanged week on week.
Southern European wire rod
Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Southern Europe was €575-585 per tonne on Wednesday, down by €10-15 per tonne from €585-600 per tonne on November 8.
Prices dipped in the wire rod market.
Sources, however, forecast that prices rises are on the horizon given production cuts and the scarcity of import offers, Fastmarkets heard.
Published by: India-Inés Levy
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Northern Europe, was €605-630 ($605-684) per tonne on Wednesday down by €5 per tonne from €610-630 week-on-week.
Demand remained slow in the Northern European rebar market.
An ongoing bearish outlook and weak demand resulted in minimal volumes being reported, Fastmarkets heard.
Despite depressed market conditions, high input costs like gas and energy and production cuts resulted in prices remaining unchanged.
Meanwhile, the corresponding Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Northern Europe, was €600-610 per tonne stable week on week.
Sources reported weak demand, high logistical costs, and an overall bearish outlook.
Published by: India-Inés Levy
Fastmarkets’ weekly price assessment for steel sections (medium) domestic, delivered Northern Europe was €750-800 ($814-869) per tonne on Wednesday, up by €15-30 per tonne from €720-785 per tonne on November 8.
Fastmarkets’ weekly price assessment for steel sections (medium) domestic, delivered Southern Europe was €750-800 per tonne on Wednesday, up by €20-30 per tonne week on week from €720-780 per tonne on November 8.
Prices rose and narrowed in the past seven days, with sections mills producing at cost and therefore unwilling to book at lower levels, but also targeting an upwards move in the market, sources said.
Offers at €810 per tonne were reported during the pricing period.
But a distributor source told Fastmarkets that a weak end-user market was putting pressure on downstream sales prices and narrowing profit margins for traders.
The distributor added that buyers will be hesitant to purchase sections at higher market levels, and that trade was sluggish.
Rising hot-rolled coil feedstock costs have supported an upward move in the market however, with further increases expected before the year’s end.
Fastmarkets’ daily calculation of its steel hot-rolled coil index domestic, exw Northern Europe was €654.13 per tonne on Wednesday, up by €9 per tonne from €645.13 per tonne a week earlier and €39.38 per tonne month on month.
Traders were skeptical around the sustainability of price increases in both the sections and HRC markets in the past seven days, due to ongoing weak end-user demand.
Published by: Holly Chant
In Northern Europe, more buyers have been coming back to the market for restocking in the week to Thursday. Mill sources were also reporting higher numbers of inquiries for HRC tonnages with delivery in the first quarter of 2024.
“The buyers are back, but they are trying to negotiate lower prices,” a distributor in Germany said. “So we have a classic situation — producers’ market versus buyers’ market. However, the chances of achieving the offer prices in deals are quite good, given the improved buying, lower availability domestically and uncompetitive imports.”
Offers of HRC with lead times of six to eight weeks were heard at €680 ($738) per tonne ex-works, and even €700 per tonne ex-works from some suppliers.
A re-roller in the Benelux area was offering January-delivery HRC at €650 per tonne ex-works, up from €620 per tonne ex-works for December.
“Mills are not prepared to negotiate on offers and most buyers believe that domestic prices have bottomed-out,” a steel service center in the region said.
“The range of €650-680 per tonne ex-works [for HRC] sounds reasonable, but demand is still below the normal levels,” a trader in the region said.
A second trading source also pointed out that real demand for steel in Europe was still rather low, so the current uptrend might not be sustained into the first quarter of 2024.
Transactions were reported at €650-660 per tonne ex-works in the region. Also, a sale of January-delivery coil from a Nordic producer was heard at €670 per tonne ex-works on Thursday, but was not confirmed at the time of publication.
Italy-origin coil was offered to Germany at €680-700 per tonne delivered.
As a result, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €655.67 ($712.05) per tonne on November 16, up by €1.54 per tonne compared with €654.13 per tonne a day earlier.
The index was up by €5.07 per tonne week on week and by €40.92 per tonne month on month.
Meanwhile, in Southern Europe, Fastmarkets calculated its corresponding daily steel hot-rolled coil index domestic, exw Italy at €633.33 per tonne on November 16, up by €0.83 per tonne from €632.50 per tonne on November 15.
The index was up by €5.41 per tonne week on week and by €38.33 per tonne month on month.
The market was slower in Italy, but local steelmakers were also pushing for higher prices.
Offers of material for first-quarter delivery were heard closer to €680 per tonne delivered (€665 per tonne ex-works), but no trades have been heard at such prices yet.
Tradeable values were estimated by buyers at €630-640 per tonne ex-works.
Import HRC offers were largely stable day on day, with HRC for January shipment from Asia available to European ports at €610-620 per tonne CFR. This would mean arrival in March.
“Asia-origin coil, bought now, will arrive in Europe only in March , and therefore could be customs-cleared only after April 1  to fit the [European Union’s] safeguarding [quota] allocations. The price gap to European [domestic HRC] is not sufficiently attractive to take such a risk,” a buyer in Italy said.
From India, offers were heard even higher, at €640 per tonne CFR.
Published by: Julia Bolotova
Fastmarkets’ weekly price assessment for steel beams, domestic, delivered Northern Europe, was €730-750 ($793-814) per tonne on Wednesday, unchanged from a week earlier.
Similarly, Fastmarkets’ weekly price assessment for steel beams, domestic, delivered Southern Europe, was €730-750 per tonne on Wednesday, also stable week on week.
Market participants said that an economic environment of high interest rates and high inflation continued to contribute to weak end-user demand. So trading was sluggish, with little need to restock because of poor demand and “sufficient” stocks at distributors.
Traders said that beams were now being offered for January production, but market sources said that distributors were unwilling to pay higher prices due to pressure on slim margins.
Scrap feedstock costs in Turkey’s bellwether market rose in the week, and month on month, but trading activity was muted later in the pricing period following a flurry of bookings.
Fastmarkets’ calculation of its daily index for steel scrap, HMS 1&2 (80:20 mix), North Europe origin, cfr Turkey, was $378.93 per tonne on Wednesday, up by $5.78 per tonne week on week from $373.15 per tonne and up by $19.43 per tonne month on month.
Published by: Holly Chant
Italian rebar prices are stable on-week after ticking up by some €30/tonne ($32) this month compared to the low point of the range seen in October. This follows the hike attempt by local steelmakers, who pushed November asking prices to €320-350/t base ex-works depending on mill, sources tell Kallanish.
Transaction prices are flat at €300-310/t base ex-works. Including extras, domestic rebar is fetching €560-570/t base ex-works. Domestic mesh is meanwhile being sold at about €400/t, to which buyers must add transport and around €300/t size extras. However, for rebar, prices should reach €320/t base ex-works in the coming days, sources observe.
Persistent bad weather conditions in central Italy are causing building works and deliveries to be delayed, with no change from last week. A distributor says he has enough business until the first quarter next year. Several distributors are waiting for large infrastructure projects that should be financed by the European recovery fund to start in 2024.
“Many service centres are discounting material to sell. We had a good beginning of the year which is going to save our financial results, but the second half has been extremely quiet. We are keeping our stocks low. We have several clients who are idling their production plants,” a source comments.
Natalia Capra France
Ukraine, in collaboration with a consortium of British insurance companies, has established a specialised mechanism to facilitate access to the Black Sea corridor for exporters, according to Ukrainian Prime Minister Denys Shmyhal.
“This will make it possible to provide a discount on the cost of insurance against military risks for exporters of all products from Ukraine. This will make the Black Sea corridor more accessible to a wider range of exporters,” Shmyhal said.
This comes after discussions between Ukrainian President Volodymyr Zelenskyy and UK Prime Minister Rishi Sunak aimed at providing more affordable war risk insurance for exporters shipping goods from Ukraine, including steel and iron ore.
Denys Shmyhal emphasised the Ukrainian government’s commitment by allocating funds to ensure coverage of potential losses. The mechanism involves the participation of the Export Credit Agency, Ukrgasbank, Ukreximbank, and a consortium comprising 14 insurers, Kallanish notes.
Last Wednesday, a Russian anti-radar missile struck a civilian Liberian-flagged cargo ship in Pivdennyi port in Odesa, resulting in the death of a harbour pilot and injuries to three crew members and a port worker. The cargo ship was in the process of loading iron ore destined for China. The missile was believed to have been utilised to potentially target Ukrainian military radars in the region.
After withdrawing from a UN-brokered agreement guaranteeing safe transport of Ukrainian grain via the Black Sea, Russia has frequently targeted Ukrainian port infrastructure.
In response to the de facto Russian blockade in the Black Sea hindering Kyiv’s seaborne exports, Ukraine established a “humanitarian corridor” in August for ships heading to African and Asian markets. This route traverses Ukraine’s southwestern Black Sea coast, crosses into Romanian territorial waters, and extends towards Turkey. This corridor, initially designed for humanitarian purposes, is now also utilised for agricultural and steel products shipments.
Meanwhile, ship traffic continues both in and out of the ports of Greater Odessa. Since 8 August, 91 vessels have exported 3.3 million tonnes of agricultural and steel products, while 116 vessels have arrived for loading at the ports of Odessa, Chornomorsk – prior to 2016 named Illichivsk – and Pivdennyi – prior to 2017 named Yuzhnyi.
Elina Virchenko UAE
Following a period of quiet activity, Italian coil prices are increasing significantly, in line with European mills’ hiking asking prices, Kallanish learns from market participants.
Over the past two weeks, strong demand has returned to the market and hot rolled coil prices have gradually gone from the level of €600/tonne ($651) base ex-works at the beginning of the month to €630-650/t base ex-works this week. Producers have filled January order books and are now quoting February lead times.
All service centres have gone back to purchasing for January delivery, with limited material availability persisting as European steelmakers are allocating lower volumes to buyers for first-quarter delivery.
The import market is not attracting service centres due to the exhaustion of EU safeguard quotas and the long lead times. A high-volume transaction for HRC from India is rumoured to have taken place at €640/t cfr Italy for January boarding.
Some optimism is back and the wave of price increases should also interest coil derivatives. Sheet and tube makers are also pushing up their values, although the downstream market remains fragile, sources say.
All producers in Italy are reporting increased demand and prices for HRC, and some sources expect values to increase to €670-680/t delivered in the coming days. A service centre however believes that, if European prices go over this level, buyers will turn to the import market.
Natalia Capra France
Production of crude steel by Sweden’s mills continued in September the downward trend seen so far this year, and in fact accelerated it.
Crude steel output totalled 315,000 tonnes, 12.7% less than in September 2022, Kallanish learns from the latest statistics of national steel federation Jernkontoret. The decline is notably steeper than the year-to-date drop of 4.4% in the nine months through September to 3.279 million tonnes.
This was still relatively in line with the January-June period, which saw 4.5% less output than the first half of 2022.
“The declining demand continues to affect crude steel production,” says Mathias Ternell, trade policy director at Jernkontoret. The production statistics are compiled by Jernkontoret and are based on data from 11 steel manufacturers in Sweden.
Christian Koehl Germany