European HRC prices remain stable as market participants return from holidays
Domestic European prices for hot-rolled coil remained stable on Aug. 27, as market participants returned from summer holidays and expectations increased of a revival in activity and demand.
“Prices should pick up in the next month,” a mill source said. “[However,] it is still too early to say.”
“I see recovery in the first quarter of 2025,” a service center source said. “Toward December there might be a bullish phase [in the market].”
Market sources also noted a continued lack of interest from the market following the announcement of the European Commission of anti-dumping investigations for a variety of Asian countries.
“We all expected a reaction to the investigations against the Asian countries,” a service center source said.
Interest in imported HRC from China has been moderate, with some Chinese mills offering to finance the cost of safeguard duties to incentivize demand. Although it remains unclear whether consumers will take this onboard, sources said.
Sources emphasized the importance of production cuts by mills to help balance out market fundamentals. They also suggested government intervention, such as subsidizing certain industries, to alleviate market pressures.
“Without subsidies, the market will not move,” a service center source said.
Platts assessed Northwest European HRC at Eur595/mt ex-works Ruhr on Aug. 27, stable on the day.
Meanwhile, Platts assessed domestic HRC prices in Southern Europe at Eur595/mt ex-works Italy on Aug. 27, also stable on the day.
European HRC prices under pressure from oversupply, lack of demand – sources
Despite the summer holiday period coming to an end, there have been few signs yet of the traditional rebound in trading and prices, they added, with European mills keeping quiet and providing no firm offers to the market.
“Mills are being very cautious,” a buyer in Germany said. “They do need to increase prices to [improve their] margins, but it’s clear the market is too weak for a price recovery. It’s very much a case-by-case approach.”
Buyers have also stayed on the sidelines, although some sources said they were likely to resume purchasing when the prices went a bit lower.
Bookings were reported at €580-590 ($648-659) per tonne ex-works in Northern Europe, for October-delivery HRC, with estimates of the tradable value put at about €590-600 per tonne ex-works by sellers and buyers.
One supplier was still hoping to achieve €620 per tonne ex-works, Fastmarkets understands, but most buyers said that price was “unworkable.”
“Oversupply remains a key drag [on HRC prices],” a mill source in the region said. “Mills are fighting for orders, but some suppliers drop their prices too easily [if they receive] a decent bid.”
Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €597.50 ($667.59) per tonne on August 27, down by €4.33 per tonne from the previous calculation of €601.83 on August 23.
Fastmarkets’ daily HRC indices were not published on Monday due to a public holiday in the UK.
The Northern Europe index was down by €14.58 per tonne week on week and by €31.17 per tonne month on month.
Sources said that recent restrictions on imports of flat steel – including a safeguarding review, and an anti-dumping (AD) investigation into HRC from Egypt, India, Japan and Vietnam – had provided only limited support for domestic markets.
“Recent import restrictions have only slowed the pace of [the fall in domestic HRC prices]. But it’s no game-changer for now,” a buyer in Italy said.
Market sources said that oversupply and subdued demand from the key end-user sectors remained the principal factors acting to drag down domestic HRC prices.
But the recent price drops in China have been a disturbing factor for global markets, “spreading weak sentiment,” market sources said.
“Chinese prices tumbled in August and FOB prices [for HRC] fell to a four-year low before regaining some ground this week,” a trader source in Europe said on Tuesday.
Sources in Italy, meanwhile, said that China-origin HRC prices were competitive for European buyers – even taking into account the EU’s anti-dumping measures.
“With the AD duty, China-origin coil is being offered to Italy at €540-550 per tonne CFR. Some suppliers have even [asked for] €520 per tonne CFR,” a second buyer in Italy said. “No deals have been sealed yet, but European buyers are starting to consider purchasing from China again.”
The EU imposed definitive anti-dumping and countervailing duties of 18.10-35.90% on HRC imports from China in April 2017. And in June 2023, it extended these duties for five more years.
Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €595.00 per tonne on Tuesday, down by €5.00 per tonne from the previous calculation of €600.00 per tonne on Friday.
The index was down by €12.50 per tonne week on week, and by €25.00 per tonne month on month.
The Italian market has just reopened after its traditional summer break, although a key local supplier had yet to announce its new offer prices for October-delivery HRC.
But buyer sources estimated that the current workable price was €590-600 per tonne ex-works.
Late-October shipment HRC from South Korea was on offer to Italy at €590 per tonne CFR, Fastmarkets understands, but sources said that buyer price ideas for overseas coil were unlikely to be higher than €540 per tonne CFR.
Published by: Julia Bolotova
Italian car output continues to slow
Italian passenger car production tumbled in May and in the first five months of the year, Kallanish notes from local carmakers association Associazione Nazionale Filiera Industria Automobilistica (Anfia) preliminary data.
Car output fell year-on-year by as much as 49.3% in May to 29,119 units, and by 29.7% on-year in January-May to 171,145 units.
By comparison, German five-month output declined by 6% to 1.7 million units, and by 18% to 307,500 cars in May. The UK recorded a fall in May of 11.9% to 69,952 cars and a moderate 3.2% decline to 353,843 units in January-May. Spain’s May car production however hiked by 5.7% to 208,575 cars and by 7.7% to 908,015 cars in January-May, Anfia points out.
“The automotive production sector is in the context of industrial production decreasing again in April 2024 compared to the previous year’s levels. In May, the industrial production index as a whole closed down at 3.3%, and in the first five months of the year compared to the same period in 2023,” Anfia says in a report.
Italy has 23 car production plants. Spain has 17 plants, France 31 and Germany 42.
Anfia is collaborating with the government and Stellantis to define a roadmap for the automotive industry’s relaunch. It aims at boosting Italy’s automotive production capacity beyond the level of 1 million vehicles/year through state support on decarbonisation, research and development, and new production plant investments (see Kallanish passim).
According to the latest data, in January-March 2024, exports of passenger cars and new industrial vehicles were worth €5.3 billion ($5.7 billion) while imports reached €10 billion. The US represents the largest export destination for Italian passenger cars with 17.4% market penetration, followed by Germany with 16.1% market share and France’s 12.3%.
According to a Fim-Cisl union document obtained by Kallanish, Stellantis’ production in Italy during the first half of this year saw a significant decline of 25.2%, resulting in the manufacturing of 305,510 vehicles. In the passenger cars segment, the carmaker’s output experienced a drop of 35.9% to 186,510 cars.
Except for Pomigliano and Atessa’s light commercial vehicle facilities, every Italian plant is seeing a decrease. Maserati automobile production has dropped by 70%, with only 1,850 vehicles manufactured in the first half. The unions estimate a total output of somewhat more than 500,000 vehicles from Stellantis’ Italian operation.
Natalia Capra France
Bekaert announces financial leadership transition
Belgian wire solution specialist Bekaert has announced a new chief financial officer effective 1 November, Kallanish discovers from a company press release.
Current CFO Taoufiq Boussaid is stepping down to pursue other opportunities, effective 31 October. Bekaert has named Seppo Parvi as the new CFO and a member of Bekaert’s group executive committee.
Boussaid joined Bekaert in July 2019 and was a member of the group’s executive committee. He helped improve profitability and cashflow generation and leaves the company with a stronger balance sheet and increased shareholder value, the company states.
Parvi joins Bekaert with an extensive international financial and operational background. Since 2014, he held positions as cfo, deputy to the ceo and Finland country manager at Stora Enso.
“Seppo Parvi is an experienced cfo with a strong executive and financial leadership career track record,” states Yves Kerstens, chief executive officer. “We look forward to him joining Bekaert and continuing the transformation that will support our future ambitions and the execution of our corporate strategy.”
John Isaacson, USA