European HRC prices largely flat amid continuing summer lull
According to industry sources, mills in the region offered October-delivery hot-rolled coil at €630-640 ($696-707) per tonne ex-works. HRC offers at prices lower than that for September-October delivery were reported in Germany at €610-620 per tonne ex-works.
Buyers estimated workable prices in the range of €590-620 per tonne ex-works.
Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe at €612.08 per tonne on Tuesday, up by €1.58 per tonne from €610.50 per tonne the previous day.
But the index was down by €4.17 per tonne week on week and by €16.50 per tonne month on month.
“The market is still quiet. Nothing serious is happening,” a buyer source told Fastmarkets.
A second buyer source said that the prices for HRC in Northern Europe have reached such low levels that some production cuts might be necessary.
Meanwhile, in Southern Europe, Fastmarkets calculated its corresponding daily steel hot-rolled coil index, domestic, exw Italy at €607.50 per tonne on Tuesday, unchanged from the previous day.
The index was down by €7.50 per tonne week on week and by €12.92 per tonne month on month.
Summer vacations continued in Italy, with many market participants still not active, trade sources told Fastmarkets.
The situation will become clearer next week when most market participants return from the holidays, Fastmarkets understands.
The most recent offers were heard at the end of July at €640-650 per tonne delivered, which would net back to €630-640 per tonne ex-works.
Buyer sources estimated the workable price to be €590-620 per tonne ex-works.
In terms of imports, Chinese hot-rolled coil was heard offered in Southern Europe at €540 per tonne CFR, including anti-dumping duty. According to industry sources, this price was available for large volumes.
This was quite low, even compared with offers from Vietnam that were among the most competitive in the market, Fastmarkets heard.
Vietnamese HRC was heard offered at €560-570 per tonne CFR last week.
EU HRC: North nudges up, import offers soften
North European hot-rolled coil prices rose slightly today in continued quiet trading, as some mills sought a rollover for October rolling.
Argus‘ daily northwest EU HRC index rose by €1.75/t to €591/t ex-works, while the daily Italian index was unchanged at €595.25/t as the August holiday continued to quieten trade. The twice weekly cif Italy assessment nudged down by €7.50/t to €555/t cif.
A major European steelmaker officially offered to northern buyers at €630/t, but buy-side sources said this level was much too high because of weak demand. Service centres in Germany and the Benelux reported losing cut-to-length deals below €700/t, and as low as €670/t ex-works from some mill-tied distributors. While most offers were around €600-620/t base, they expected to buy below for a reasonable tonnage as mills looked to fill their rolling programmes.
One producer appears less hungry, despite not offering widely for October yet, as it is sending coil and slab to the UK.
Projects have been postponed because of the high interest rate environment, which means service centre inventories are not moving as quickly as anticipated — however they are not highly stocked, as everyone has been managing stock levels, especially those who are approaching their financial year-end. One processor said projects booked earlier in the year for October have been pushed back into the second quarter, given high interest rates.
A buyer quoted a rollover around €610/t said mills should have pushed for slight increases to try and stop the market falling.
With pressure on costs, as Chinese steelmakers reduce their production, some suggested there would be further downside for coil prices as mills will have more wiggle room without sacrificing margin. Traders said €560/t could be a viable price from domestic producers should costs continue to soften. Some expected the Chinese steel market to be close to bottoming, and a flurry of short covering could stabilise prices, helping sentiment in the global marketplace.
Chinese HRC was offered into Antwerp today around €600/t by at least one trader, although there are negotiations ongoing against another offer tabled as low as $510/t cfr, which is around €540/t including duties at today’s exchange rate with dumping and countervailing measures of 18.1pc.
Sustained decreases in Chinese HRC prices have filtered into lower offers for HRC, especially from some Asian sellers. The softening is exacerbated by the strengthening of the euro against the US dollar, making dollar-denominated offers work out lower in euro than last week.
A Vietnamese mill was confirmed to offer at €535-540/t cfr EU, but it was struggling to find any interest. India was reported at €560-575/t cfr south EU.
One offer from a Turkish mill stood at just under €560/t cfr Italy last week, whereas another mill was heard offering HRC at between €570-590/t cfr, duty included. Trader offers have been made at a premium to these prices, especially for some higher-quality Asian material, although one seller was heard close to the Vietnamese offer. Japanese cold-rolled coil was offered into Antwerp at €665/t fca, down around €20/t over the last week.
Feedback from buyers was limited, with many still absent from the market for holidays.
In the futures market today, October traded twice at €616/t on the CME Group’s north European contract, while two fourth quarter strips traded later in the day at €630/t.
Trump: I will stop Japan from buying United States Steel
Former US president Donald Trump, a Republican, and Democratic Pennsylvania governor Josh Shapiro are providing fresh criticism of Nippon Steel’s proposed takeover of US Steel (USS), with each politician renewing their opposition to the deal.
Speaking at his presidential campaign rally in York, Pennsylvania, Trump again promised to block the transaction if voters return him to the White House.
“I will stop Japan from buying United States Steel,” Trump said. “They shouldn’t be allowed to buy it.”
Shapiro mentioned the controversial deal at the Democratic National Convention in Chicago, Illinois. Speaking with news reporters, Pennsylvania’s chief executive emphasised that the Nippon takeover of the 123-year-old Pittsburgh-based steelmaker is not in the interests of the USS employees or the communities in his state. His new comments come less than a week after the United Steelworkers labour union repeated their concerns that there is a lack of financial transparency regarding Nippon’s investment plans for the USS mills.
“I’ve been very clear that I’m not supporting any deal that the US Steel workers don’t support,” Shapiro stated. “Nippon has a lot of work to do in order to get right with the steelworkers, if they’re ever able to.”
The acquisition is under review by federal antitrust and trade regulators. It is also the subject of arbitration, which began last week. While arbitration has progressed and after the Trump and Shapiro remarks, USS shares have lost almost 10% of their value.
Dom Yanchunas USA
India HRC export activity remains curbed
Indian hot and cold rolled coil export activity to Europe continues to be weak amid the anti-dumping investigation and summer holidays in the EU, Kallanish learns from sources.
In Europe, no new India-origin HRC offers have been heard this week, for the third consecutive week. The last heard offers were at around $640-650/tonne cfr Antwerp, or $590-600/t fob India, for S235 grade, August/September shipment.
In August, the European Commission launched an anti-dumping probe against HRC from India, Egypt, Japan, and Vietnam. Turkey also issued dumping margins on India-origin HRC, at 11.65% for Tata Steel and at 18.26% for other mills.
Indian traders are unsure of when demand and trading activity will recover in the EU. Sources are not anticipating any EU buying to happen until the ongoing AD investigation is concluded.
Earlier, market sources had estimated activity in the EU may improve from September following the summer holiday lull.
According to the EU’s TARIC portal, India’s third-quarter EU safeguard quota balance stands at 66,926 tonnes as of 19 August, meaning 78% of the available quota is exhausted.
No new Indian-origin CRC offers to Europe were heard this week either. The last heard offers were at around $725-740/t cfr Antwerp, or $675-690/t fob India, for DC01 grade, August/September shipment, with offer prices negotiable.
In the South Asian market, no new India-origin offers to Nepal or Bangladesh were heard this week. Last week, offers to Nepal were heard at $565-575/t cfr delivered up to Raxaul Road/the Nepal border. Sources say Nepal buyers were postponing buying by 3-7 days amid falling prices. Chinese offer prices to Nepal were heard by two traders at as low as $450/t fob China.
In the African market, no new offers were heard this week, with traders noting payment issues were a challenge in the region. The most recent, limited offers, only applicable for select buyers, were reported at $580-590/t cfr Djibouti for end-August/September shipment, LC at sight, base commercial grades.
India continued to remain out of the Gulf Cooperation Council, Asia and other export markets, with no new offers heard this week.
Last week, several new trade cases were announced involving India. Malaysia launched an AD probe into Indian flat steel and some other origins. India also launched a HRC probe against Vietnam, following Vietnam’s starting of an investigation on India- and China- origin HRC.
Following the multiple AD probes, sources expect India will focus on its domestic market, and is unlikely to look towards exporting to international markets. A source adds that, even if India plans to return to the GCC market, it will be very difficult to compete since Chinese prices are very low.
Suhita Poddar India
SKF decarbonises production using Austrian and Swiss Steel
European roller bearings producer SKF and voestalpine Wire Technology have produced the first prototype bearing made from steel that contains hydrogen-based direct reduced iron (H-DRI).
SKF and voestalpine have been working together since 2022 to explore the possibilities of using H-DRI steel for bearing applications, Kallanish hears from the Sweden-based company. The spherical roller bearing prototype was handed over to voestalpine Wire Technology at SKF’s factory in Steyr, Austria. Spherical roller bearings can be used in many different applications and industries, such as marine, pulp and paper production, mining and construction.
“Steel is a critical raw material in bearings, and to achieve the change and speed needed in decarbonising bearing production, the whole industry must come together,” says SKF chief technology officer Annika Ölme.
SKF recently announced it also started sourcing low-carbon steel from Swiss Steel. Since the beginning of the year, Swiss Steel has been delivering its GreenSteel Climate+ brand made at German unit Deutsche Edelstahlwerke (DEW) exclusively to SKF.
Christian Koehl Germany
EU mills gain processed coil share from distributors
European stockholding distributors and steel service centres have conceded some share of the coil market to mills and their direct supply to consumers. This applies to cold rolled and galvanized coil more than to plain hot rolled coil, Kallanish learns from statistics issued by distributors association EUROMETAL.
“Direct mill sales improve their channel position gradually the further wide strips are upgraded by cold rolling and coating,” the association writes in a recent research paper.
Of all HRC sales in the EU, the share of mill sales directly to customers in 2023 was 23%, while that of steel service centres was 40%. The statistics also consider “mill sales as pre-material” – such as for tubemakers – which took a 24% share. The remainder (13%) was sold by stockholding distributors – Multi-Product & Proximity Steel Distribution – which play a lesser role in terms of volume.
The picture shifts for further processed coil. For CRC, mills took a share of 41%, with 42% taken by SSCs. Mill sales as pre-material obviously play a lesser role for processed coil; the share of CRC here is a mere 6%. Mills score highest on coated coil, with a share of 49%, against 30% taken by SSCs.
In total, of all strip products taken together, mills, in their direct-to-customer sales, lifted their share from 34% in 2021 to 36% in 2023, totalling 22 million tonnes. The share of SSCs in that two-year period dropped by the same rate, from 38% to 36%, also totalling 22mt.
EUROMETAL notes that distributors play an overall bigger role in sales of long products, for which they account for 75% of total EU supply (see European distributors lose volume in 2020s – 20 August).
Christian Koehl Germany