European HRC trading still slow, with market divided over direction of prices
European hot-rolled coil prices held steady in a quiet market on Tuesday July 15, with a continuing lack of clarity about the direction of prices after the summer slowdown, sources told Fastmarkets.
Some buyers made inquiries about October-November deliveries and said they expect to see a price rebound after the summer stoppages.
“Prices have reached ‘rock bottom’ [and] the market is likely to stabilize at the current level before the summer stoppages in August,” a German buyer said,
“European mills will try to increase [HRC] prices after summer break, counting because the [carbon border adjustment mechanism] (CBAM) will interrupt imports in the first quarter of 2026,” the buyer added.
Other buyers, however, maintained a “wait-and-see” stance and said they expect the downtrend to continue, given the insufficient consumption and the influx of low-priced imports in recent months.
In northern Europe, offers were reported to Fastmarkets at €560-570 per tonne delivered (€550-560 per tonne ex-works) in Germany and at €560-570 per tonne ex-works in the Benelux area.
Buyer estimates of the tradable level remained at €530-560 per tonne ex-works, depending on tonnage.
Supplier sources estimated achievable price for big tonnages [2,000 tonnes and more] at €540-550 per tonne ex-works and at €560-580 per tonne ex-works for smaller lots.
Some suppliers, however, argued, that levels of€540-550 per tonne ex-works were “special deals” and therefore “outliers,” and not widely available in the market.
Fastmarkets’ calculation of the daily steel HRC index domestic, exw Northern Europe was €547.50 per tonne on Tuesday, up by just €1.25 per tonne from €546.25 per tonne seven days ago.
The Northern European index was also up by €2.50 per tonne week on week, but was down by €46.50 per tonne month on month.
No major progress has been reported in terms of long-term contract negotiations with end users for the second half of the year.
“From what we heard, the [original equipment manufacturers] (OEMs) have not yet widely sealed their second-half 2025 contracts yet,” a source said.
An automotive OEM in Europe told Fastmarkets they were seeking a €50-100 per tonne reduction from the level of the first-half contracts because the gap between the long-term deals and spot prices has been “unrealistically wide.”
Several sources said that contracts with OEMs from the automotive sector for the first half of 2025 were done at €650-700 per tonne.
A second automotive OEM said an achievable price for second-half 2025 contracts was €620-640 per tonne.
In Southern Europe, meanwhile, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €523.96 per tonne on Tuesday, up by €1.46 per tonne from €522.50 per tonne on July 14.
The index was up by €3.96 per tonne week on week, but down by €56.04 per tonne month on month.
Trading in Italy was also quiet on Tuesday, Fastmarkets understands.
The most recent offers came in at about €530-550 per tonne ex-works, while the tradable level was said to be €520-525 per tonne ex-works, depending on the tonnage.
One deal was reported by a supplier at €530 per tonne ex-works.
Overall, sources agreed that Italian prices were either close to or had already hit rock bottom.
“Some suppliers have already withdrawn their offers form the market,” a buyer in Italy said. “There are no higher offers on the table yet, but it looks like the downtrend has stopped.”
Some market participants recently reported some stability in overseas coil prices, following the previous week’s rebound in Chinese HRC prices.
August-shipment HRC from Turkey was on offer to Italy at €480-500 per tonne CFR, including anti-dumping duty.
Offers were also heard from Indonesia to Italy, at €450 per tonne CFR, and to Antwerp in Belgium at €460-470 per tonne CFR.
And one source reported an offer of HRC from Algeria to Italy at €495 per tonne CFR.
Uncertainty over new tariffs ‘killing’ US steel demand
President Trump’s announcement of potential new tariffs that exceed the initial “reciprocal” rates unveiled on April 2’s Liberation Day has increased uncertainty in the US steel market and the risks to global trade.
Brazil, Canada, the EU and Mexico have received notice that their tariffs could increase further unless trade talks progress ahead of the new August 1 deadline. These “reciprocal” tariffs cannot be applied to US steel imports on top of the existing Section 232 tariffs. However, higher baseline tariffs would raise the cost of US steelmakers’ raw materials, applying upward pressure to steel prices and increasing uncertainty among steel buyers in a climate of low demand.
MEPS US steel market analyst, Laura Hodges, said: “There is not a lot of good news for US steel buyers right now. Interest rates remain high, activity remains cautious and the latest tariff announcements only acerbate this situation.
“We continue to hear from MEPS respondents that it is impossible to plan in this uncertain environment. This ‘wait and see’ approach is killing steel demand.”
Tariff threats aim to accelerate trade talks
Trade negotiations have been slower than the US government anticipated. Originally, a July 9 deadline was set, after which country-specific reciprocal tariffs above a 10% base rate would take effect. Last week, this deadline was extended to August 1.
To accelerate talks, the US government has issued letters outlining new baseline tariff rates to over 20 countries and the EU. Brazil’s rate was raised to 50%, while the EU now faces a 30% tariff, up from 20%, if progress is not made in trade negotiations. Tariffs on Mexico and Canada were increased to 30% and 35% respectively, though these apply only to good that do not comply with the United States-Mexico-Canada Agreement.
So far, only two preliminary trade deals have been announced, with the United Kingdom and Vietnam. Of these, only the UK agreement has been formally communicated, and parts of that deal are now at risk. The UK secured a lower 25% tariff on steel imports into the US. However, this exemption was linked to conditions that must be met by the country’s government by the July 9 deadline. No formal announcement has yet been made and there remains a risk that US tariffs on UK steel imports could revert to the full 50% Section 232 rate.
“Reciprocal” tariffs’ influence on US steel sector
While not directly applicable to steel imports, higher baseline “reciprocal” tariffs could affect US steel demand in several ways. Section 232 tariffs do not cover steelmaking raw materials such as scrap, pig iron and DRI. However, these inputs remain subject to the “reciprocal” tariffs which currently sit at 10% for most countries. Brazil supplies about 30% of total US imports of these materials. If its baseline tariff rises to 50%, it will increase production costs and could weaken downstream demand.
Persistent uncertainty continues to weigh on steel buyers, who have largely stayed on the sidelines, in 2025, as they await clarity on US trade policy.
Against this backdrop of lacklustre demand, respondents to MEPS’s research for its International Steel Review indicate that steel prices have shown limited upward momentum since the doubling of the Section 232 tariff to 50% on June 4. The July contract price for hot rolled coil on the Chicago Mercantile Exchange (CME) reflects this. Having jumped from USD801 per short ton on May 30 to USD923 on June 4, prices have since dropped by almost USD50 per short ton.
With less than three weeks until August 1, the scarcity of finalised trade deals suggest the possibility of yet another extension, prolonging uncertainty and keeping demand sluggish. The likelihood that the 50% Section 232 tariff might be reduced through these negotiations also appears to be decreasing.
