HRC producers in Europe target higher prices for Q1-rolling coil despite limited demand
Trading remained quiet in the European HRC market with buyers holding back and making mainly hand-to-mouth purchases.
Offers of February-delivery coil from integrated producers in northern Europe were heard at €710-730 ($764-785) per tonne ex-works, with “very limited room for negotiations,” sources said.
“Mills in Europe are keen to raise prices at €700 [per tonne ex-works] minimum, but this increase is rather cost and supply driven; demand remains slow,” a trading source in the region said.
An offer of January-rolling HRC from a re-roller in the region was heard at €685 per tonne ex-works.
Tradeable values were reported by buyers at €680-695 per tonne ex-works.
Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe at €686.00 per tonne on Monday, up by €0.58 per tonne from €685.42 per tonne on December 8.
The index was up by €9.33 per tonne week on week and by €33.33 per tonne month on month.
Most sources agreed there still was room for price upticks because availability in the market was reduced due to output cuts and because mills had good order books.
“It is likely that another €20-per-tonne increase could be achieved for the first-quarter-rolling coil, simply because buying options are quite limited at the moment,” a steel service center in Germany said.
But sources questioned the sustainability of the uptrend into late first quarter due to expected restarts of blast-furnace operations at some European mills in the first quarter of 2024.
Fastmarkets calculated its daily steel HRC index, domestic, exw Italy at €668.33 per tonne on Monday, up by €2.91 per tonne from €665.42 per tonne on Friday.
The Italian index was down by €1.67 per tonne week on week but up by €38.33 per tonne month on month.
The Italian market was quiet after a long weekend.
Offers for February-delivery HRC from local suppliers were heard at €720 per tonne delivered (around €705 per tonne ex-works).
This compares with offers and transactions for January-delivery coil in the nation at €680 per tonne delivered (€660-665 per tonne ex-works).
Several buyers suggested that €700-710 (€685-695per tonne ex-works) could be achieved for February-delivery HRC in the nation due to limited supply.
“Steel service centers and distributors are still late on passing the increase of coils to end-users due to low real consumption. So they are trying to negotiate slightly lower prices [for HRC] with mills,” a trader in the nation said.
Meanwhile, prices for overseas HRC also rose with some suppliers making offers in line with European mills, while lead times were between three and four months for imports.
Offers of February-shipment HRC of India origin were heard at €650-655 per tonne CFR.
January-February-shipment HRC from Turkey was reported to be available to Italy at €670-680 per tonne CFR, including anti-dumping duties.
From Asian suppliers, offers for February shipment were heard at €640-650 per tonne CFR.
Published by: Julia Bolotova
Vallourec, Bekaert invest in components for green hydrogen
French pipemaker Vallourec has developed a large-scale hydrogen storage technology under the brand name “Delphy.”
The company has inaugurated its vertical compressed gas hydrogen storage demonstrator at its site in Aulnoye-Aymeries, northern France. It is a modular system that stores the green gas in “demanding industrial environments,” the firm says. The demonstrator made of tubes and connections equipped with sealing technology and corrosion resistance is installed underground and can store up to 100 tonnes of hydrogen for industrial applications and heavy mobility.
“Growth prospects in the global hydrogen sector are substantial, with a projected installed capacity of 61 million tonnes by 2030, providing Vallourec with an estimated revenue of several tens of millions of euros per storage unit… This project offers reliable, modular and competitive large-scale storage capacity. Vallourec offers a unique value proposition for the development of the hydrogen economy,” the re-roller says in a note seen by Kallanish. The demonstrator is part of the pipemaker’s strategy to expand its product offerings in the energy transition segment. The company expects its so-called “New Energies” segment to contribute between 10% and 15% of its Ebitda by 2030.
Belgian wire rod specialist Bekaert is continuing to develop hydrogen components for electrolysers and will invest $ 5 million in Vancouver-headquartered Ionomr Innovations, a specialist of advanced proton and anion exchange membranes in electrolysers for green hydrogen production. The two firms have collaborated in the past to develop AEM electrolyser components.
Bekaert has developed porous transport layers for both PEM and AEM electrolysers with the brand name Currento and is expanding its production to multiple gigawatts capacity. The company’s focus is to improve the performance of key electrolysis components. “We want to contribute to accelerating the innovation and scale-up of advanced solutions in our ecosystem. This will make the vision of a global hydrogen economy a near term reality, and we see Ionomr Innovations as a key contributor to that reality,” a company note states. Ionomr Innovations is backed by investors such as Shell, Chevron, Samsung, Asahi Kasei and several other industrial groups.
Bekaert is investing in a new manufacturing plant in Wetteren, Belgium, to double production of its “Currento” porous transport layers (PTL) technology for electrolysis. The new plant will increase PTL capacity to over 2 GW. In parallel, the steel processor will build a hydrogen lab at the Bekaert Technology Center in Deerlijk to develop products for green hydrogen production. Bekaert is investing to adapt its “Armofor” steel cord lightweight reinforced tape for use in pipelines for hydrogen transport at high pressure. It is currently used in oil and gas pipes. Vallourec is developing a new protocol to test its tubular solution for safe hydrogen transport. A research team is studying Vallourec’s VAM 21 connection behaviour at temperatures and tensions relevant for the storage of hydrogen (see Kallanish passim).
Natalia Capra France
AST to stop production on low orders
Italian stainless steel coils maker Acciai Speciali Terni, part of Arvedi, is to implement a longer production stoppage this year for the Christmas holiday break, the company confirms.
The hot end area will be idle from 19 December until 7 January.
“The stoppage is a consequence of the contraction of the steel market in general and the high cost of energy that AST is forced to pay compared to its competitors,” a company spokesperson tells Kallanish. The steelmaker has already idled production for three days from 28 November to 1 December due to the contraction in orders that is affecting the European market, following better demand in September and October.
Economic uncertainty and slow orders are hitting Italian stainless steel margins and volumes. Demand continues to be sluggish but processing costs are simultaneously increasing, local steel trade association Assofermet has warned last month. The sector is experiencing the worst margin contraction in 2023, which has become worse over the past 90 days (see Kallanish passim).
Natalia Capra France
NW European plate buyers feel Italian hikes
Plate buyers north of the Alps confirm the price hikes reported from Italian re-rollers in the offers they have received lately.
The hikes from Italy are somewhat stronger than those tried by northwestern European mills. They were also higher than the prices offered to domestic customers in Italy.
“Currently, we could buy from Italy S235 for €800/t ($863) delivered Germany, based on a domestic price of €740 ex-works,” says one southern German manager who usually buys Italian. That ex-works domestic price is in line with the price reported for grade S275 (see Kallanish 1 Dec). However, a bigger difference opens when looking at S355, the grade Germans mainly ask for.
While normally the difference is €20-30 at most, one buyer sees ex-works offers stretching up to €790, meaning a premium of €50 over the lower grade. He notes that premiums vary between mills from €30 to €50. A third-party deal to his customers would result in €850 delivered for the consumer, he says. It is not quite clear if the premium of €50 is a temporary or arbitrary phenomenon.
One Ruhr-based buyer tells of Italian offers at €820/t for S235 delivered, and says he would pay €30 more for S355.
According to the southern German buyer, Italy currently has the lowest offers, undercut only by a UK mill for certain grades. According to a mill source, however, offers in eastern Europe are altogether lower, at €750 delivered in Poland, but could be charged higher when selling westward.
Prices from mills to buyers in northwestern Europe are currently seen at €800-820 delivered.
Christian Koehl Germany