European merchant market projected to hold steady
Merchant bar prices in Western and Southern Europe are stable compared to last month, with some producers now considering increases amid elevated production costs and rising scrap prices.
Some market participants in France, Spain, and Italy contend that passing on increases downstream is challenging, as consumption remains constrained in Europe. This situation is offset by a more robust demand from Eastern European countries.
A leading steel producer tells Kallanish that while volumes in Europe remain average, margins have significantly deteriorated since the latter half of 2023.
The elevated energy prices, particularly in Italy, along with high scrap values, continue to exert pressure on profitability.
Meanwhile, the reduced sales volumes are adversely affecting the European distribution sector, which is experiencing extremely low margins.
The financial performance of several major distributors in France and Italy that previously relied on volume sales has been significantly impacted by the decline in long steel products and rumours of payment delays are spreading.
European producers have capitalised on the closure of Ostrava, identifying a market gap that enabled them to reclaim the market share previously held by the steelmaker.
Currently, France and Spain have the lowest pricing in Europe, ranging from €240-260/tonne base delivered ($263-285/t). In contrast, Italy presents the highest prices, with a base delivered rate of €280-290/t excluding the average size extras priced at €420/t. Spanish producers are present in Italy, with a notable concentration in France.
The current conditions in the downstream market are hindering price increases, as diminished consumption and narrow margins restrict any upward movement to only marginal adjustments.
The tariffs imposed by the US are impacting producers only to a slight extent, while the prevailing geopolitical uncertainty is leading buyers to purchase limited quantities on a more frequent basis.
In Italy, distributors continue to buy truckloads that have already been pre-sold. In Italy, there was a restocking phase observed in March, amid a moderate resurgence in apparent demand.
However, a producer source indicates that if distributors do not sell their past purchases, they will begin to destock, leading to a slowdown in demand this month.
Eastern European nations are actively supporting demand and establishing consistent purchases. Germany’s recently announced €500 billion ($552 billion) infrastructure fund may yield some positive outcomes; however, another source presents a more cautious perspective on these potential impacts. The allocation of funds is projected to occur over ten years, ultimately representing less than 2% of the nation’s GDP.
Merchant bar price trends are expected to stabilise in April, a month characterised by reduced activity due to various public holidays.
Meanwhile, the projections for volumes in 2025 present a neutral outlook, lacking both optimism and pessimism. Sales volumes for producers are projected to stabilise at the levels observed in 2024. Short-term projections indicate that margins are likely to experience continued pressure.
Natalia Capra France
European HRC producers seek higher prices; buyers cautious amid lack of real demand
On Tuesday April 1, leading European steelmaker ArcelorMittal increased HRC prices by another €20 per tonne to €700 per tonne ex-works or delivered, Fastmarkets reported.
Later in the week, other suppliers followed the move with smaller increases, with offer prices for June-July delivery HRC in Northern Europe reported at €660-670 per tonne ex-works — in Germany and the Benelux area.
Buyers, however, estimated achievable prices at 640-650 per tonne ex-works.
“HR sheet prices are still too low to pay even €650 [per tonne ex-works] for HRC. We had a few weeks with a pick-up in orders, [but] now it’s getting quieter,” a German distributor said.
Another distributor source agreed that the current uptrend was not demand-driven, but mainly driven by trade defense measures.
“European mills are well-booked for the second quarter and import availability is limited due to safeguards and anti-dumping measures. It’s a sellers’ market now, so prices are likely to keep ticking up,” a second distributor said.
Sources, however, were worried about the long-term outlook, given the still-weak demand from key steel-using sectors and possible deterioration in demand from the already-struggling automotive sector, which is being impacted by Trump’s tariffs.
“So far, the volumes [of flat steel] taken by the automotive [sector] are not bad, but global markets remain unpredictable,” a mill source said.
Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €651.83 ($718.30) per tonne on Friday, up by €1.33 per tonne from €650.50 per tonne on Thursday April 3.
The Northern European index was up by €6.83 per tonne week on week and by €22.79 per tonne month on month.
Meanwhile, in Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €627.50 per tonne on Friday, up by €2.50 per tonne from €625.00 per tonne on Thursday.
The index was up by €2.50 per tonne week on week and by €9.17 per tonne month on month.
HRC prices in Italy were not showing the same growth momentum as in Northern Europe lately, due to muted downstream demand and relatively high stocks at buyers, sources said.
The latest offers heard from Italian suppliers were at €630-650 per tonne ex-works, but buyers were still estimating the tradable market level at €620-630 per tonne ex-works, sources told Fastmarkets.
However, a major supplier withdrew offers from the market on Thursday and was expected to come back with higher prices shortly, sources said.
In the secondary market, 4 mm HR sheet was on offer at €700-720 per tonne CPT, and sales were “not booming.”
Overseas coil offers to Italy were broadly unchanged.
Asian suppliers were heard offering HRC to Italy at €550-570 per tonne CFR for May shipment.
An Indian supplier was offering HRC to Europe at €590 per tonne CFR for May shipment.
Turkey continued to offer May-shipment HRC at €590-600 per tonne CFR, including anti-dumping duty.
Italian rebar prices edge up on improved sentiment; Spanish prices flat
Meanwhile, in the Southern European wire rod market, prices remained broadly stable on Wednesday, sources added.
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar) domestic, exw Italy was €585-640 ($644-704) per tonne on Wednesday, up by €10 per tonne from €575-630 per tonne on March 26.
Small increases in offers and trades were reported in the Italian rebar market, according to sources.
“The Italian rebar price is increasing in terms of both offers and tradeable levels. Demand had been good last week, but now customers are in wait and see mode. We will wait for the first days of April to see if producers will be able to consolidate the uptrend,” a buyer source told Fastmarkets.
First-hand deals were reported across the Italian rebar market at €585-640 per tonne EXW.
Producer levels were reported at €585-615 per tonne EXW, while other sources in the market indicated higher price levels of €610-655 per tonne EXW.
At the same time, small-tonnage exports of rebar were reported from Southern Europe to Western Europe at €590 per tonne FOB.
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered, Spain was €620-640 per tonne on Wednesday, unchanged since March 12.
Fastmarkets’ weekly price assessment for steel wire rod (mesh quality), domestic, delivered Southern Europe was €605-620 per tonne on Wednesday, widening down by €5 from €610-620 per tonne on March 26.
“We have seen some small improvements in demand and outlook. Domestic scrap costs are high and in certain categories of scrap we have seen considerably lower availability, and it was not easy to find what we needed,” a wire rod producer source told Fastmarkets.
Fastmarkets’ monthly price assessment for steel scrap E40 shredded, delivered to mill Italy was €340-365 per tonne on March 28, up from €330-350 per tonne on March 3.
Italian domestic scrap costs have been increasing since the beginning of the year, sources said.
Energy costs are decreasing, however, compensating for higher feedstock costs, according to the wire rod producer source.
Participants saw signs of an improvement in demand in the wire rod market.
But they also noted that there is minimal appetite for imported wire rod in the Southern European market.
EU trade ministries to meet on April 7 amid US tariff discussion
The meeting is scheduled for April 7, and is seen as an opportunity to assess the impact of the recent measures and discuss the potential for finding mutually agreeable solutions, which continues to be the EU’s preferred outcome, according to the document.
“While a negotiated and constructive solution is the EU preference, the ministers will also discuss possible countermeasures should the situation warrant them,” the statement said.
The Commission, in close collaboration with member states, is refining the EU’s response, especially concerning US tariffs on steel, aluminium and the automotive industry.
Still, any potential US measures in other sectors are also considered, along with the latest tariffs announced by the US of 20% for the EU.
Trade relations with China are also expected to be discussed during the meeting, Fastmarkets understands.
The background
On April 2, the White House announced additional reciprocal tariffs affecting every US trade partner, including the EU.
As a result, all EU-origin imports to the US was slapped with 20% blanket tariffs, affecting an already-struggling European manufacturing sector, including the automotive industry.
While no additional tariffs on steel were added to steel at that time, the US had imposed tariffs of up to 25% on imports of steel, aluminium and certain products containing steel and aluminium from the EU and other trading partners back on March 12, as Fastmarkets reported.
The market is still digesting the tariffs and their overall effects on commodities. Meanwhile, industry sources speaking with Fastmarkets are already anticipating the potential impacts.
“The upcoming virtual meeting will serve as a strategic dialogue with key industry stakeholders, aiming to: gather insights on the real and anticipated impact of US tariffs on EU steel and aluminium, explore sector proposals for an effective EU response, and help shape the next phase of EU trade defence policies,” the statement from European steel association Eurometal on April 4 reads.
The EU steel industry was already in crisis, having been forced to close 9 million tonnes per year of capacity in 2024, while also announcing 18,000 job cuts, European steel association Eurofer said.
The latest steel tariffs will put further downward pressure on an already-struggling industry facing reduced margins, falling demand and rising production costs.
Europe’s steel sector remains at the heart of many regional economies, with approximately 500 production sites across 22 EU member states, the Commission said. According to EU data, the European steel sector contributes around €80 billion ($83 billion) to the EU’s gross domestic product (GDP) and supports more than 2.5 million jobs.
But declines in production volumes over recent years were also clear to see in the data. Steel production in the EU-27 was 129.50 million tonnes in 2024, according to the World Steel Association. Although this total was up by 2.6% from 2023, it was still down by 15.1% from the 152.50 million tonnes made in 2022.
In the agriculture sector, the increasing strength of the euro relatively to the US dollar has also affected demand for grains of Europe-origin, particularly in the competitive Black Sea market.
A Romania-based trader called the exchange rate a “disaster” that has “killed demand completely”.
From a pure currency exchange perspective, a cargo of 12.5% wheat from the Constanta-Varna-Burgas port offered at a €12 per tonne premium to the May Euronext wheat contract would be in euro terms €233.50 per tonne.
At the end of the previous week where the exchange rate was around 1.075, that would equate to $251 per tonne, while at the current exchange rate of 1.105, the same cargo would price at $257.93 per tonne.
That led to the situation where other Black Sea origin wheat remained stable, while EU origins went up. As an example, Fastmarkets assessed Romanian 12.5% on April 3 at $257.75 per tonne FOB CVB, given the overnight exchange rate. This was higher than Russian 12.5%, assessed at $254 per tonne FOB Russian Black Sea, which was already considered by the buyers as expensive origin.
EU traders said while existing contracts to destination markets such as north Africa were not under threat, the increased uncertainty and added volatility meant buyers were sidelining new deals.
“Customers will wait to see how the dust settles before buying so we lose a precious time,” second trader said.
Traders also added that there was increasing uncertainty from a policy perspective and many were awaiting clarity from the EU and member states on tariffs.
Sam Balf in London contributed to this article.
Hydnum to supply thyssenkrupp with low-emissions steel
Hydnum Steel (HS) will supply thyssenkrupp Materials Processing Europe with low-emission flat steel totalling 100,000 tonnes over an initial seven-year period, Kallanish learns from the prospective Spanish steelmaker. The companies will also collaborate on logistics optimisation and promote the transition to a decarbonised steel industry.
“The commitment highlights the growing interest of major industrial players in low-environmental-impact steel and reinforces both companies as leaders in sustainability and advanced technology,” HS explains.
The agreement will enable thyssenkrupp Materials Processing to expand its range of environmentally friendly products and respond to the industry’s growing interest in sustainable solutions.
“Interest in clean steel is growing rapidly, and we need partners like Hydnum to offer solutions that combine sustainability and innovation,” comments thyssenkrupp Materials Processing chief executive Marcus Wöhl. “This agreement reinforces our role as leaders in the transformation of the steel industry.”
The two companies say they will additionally explore innovative business models and customised processing strategies to maximise the value of the products offered to their customers.
HS is building the first “green” steel mill on the Iberian Peninsula, which is designed to use fossil-free energy throughout the manufacturing process. It will gradually incorporate green hydrogen to substantially reduce CO2 emissions. The plant will have a production capacity of up to 2.6 million tonnes/year of flat steel. The project is valued at €1.65 billion ($1.78 billion).
Thyssenkrupp Materials Processing operates processing facilities and distribution centres across Europe, supplying the automotive, construction, and household appliances sectors. The company is part of thyssenkrupp Materials Services, one of the world’s leading independent distributors and service providers.
Todor Kirkov Bulgaria
EUROMETAL meets with EUROFER to address challenges facing the European Steel Market
On a visit to EUROFER headquarters in Brussels yesterday, EUROMETAL held a high-level meeting with Mr. Axel Eggert, Director General, and Mr. Karl Tachelet, Deputy Director General for International Affairs and External Relations.
EUROMETAL was represented by its President, Alexander Julius, Vice-President Fernando Espada, Board Member Jaap Jan Aardenburg, and Director General Ricardo Silva.
During the discussions, EUROMETAL raised serious concerns about the growing influx of imported finished steel products entering the European market. This trend, already identified in recent exchanges with processors and manufacturers, poses a significant threat to the entire European steel value chain.
EUROMETAL emphasized that the increasing volume of these imports of ready-made steel-based products is undermining both the distribution and production sectors. The impact is being felt across logistics, processing, and distribution, with broader implications for the overall competitiveness of the European manufacturing industry — an industry that supports 13.6 million direct jobs.
EUROMETAL called for close coordination and joint action with EUROFER to defend the integrity of the European market and ensure a level playing field for all stakeholders in the steel ecosystem.
EUROFER appreciated our position, and the meeting proved to be a solid foundation for exploring further collaboration in support of our shared agenda.
Europe and Asia brace for impact as US auto tariffs kick in
Asia and Europe are bracing for impact as the US administration’s 25% tariffs on imports of cars, light trucks, and auto parts are set to disrupt trade flows, mostly from key exporting countries like South Korea, Japan, and Germany.
The tariffs on cars and light trucks took effect from April 3, while duties on auto parts will be effective on May 3. However, the auto industry will not face additional tariffs announced by the US administration on April 2.
As vehicles and automotive parts are closely associated with steel and aluminum markets, the move is expected to add another layer of uncertainty as the US already has imposed 25% tariffs on all steel and aluminum imports, leading to retaliation by other countries.
South Korea’s Prime Minister Han Duck-soo said April 3 that his country will “quickly prepare emergency support measures” for industries and companies that will be affected by US tariffs on automobiles and other items.
In response to the April 2 tariff announcement by the US, China said it will take countermeasures to safeguard its own rights and interests, according to the spokesperson of the Ministry of Commerce.
Japan’s Prime Minister Shigeru Ishiba on March 27 said his government will put “all options on the table” in dealing with the US tariffs.
The European Automobile Manufacturers’ Association said the EU and the US must talk to find an immediate resolution to avert tariffs and the damaging consequences of a trade war that would not only negatively impact global automakers but US domestic manufacturing as well.
Asia
Japan shipped 1.4 million cars to the US in 2024 to become the third largest exporter to the US, according to US Department of Commerce data.
Japanese vehicle exports to the US were valued at Yen 6.03 trillion ($39.9 billion) in 2024, up 3.1% year over year, data from the Ministry of Finance showed.
South Korean vehicle exports to the US were valued at $40.01 billion in 2024, up 8.3% from 2023, data from the Ministry of Trade, Industry and Energy showed. Exports reached 1.5 million units in 2024, according to US Department of Commerce data.
China exported 106,592 units to the US in 2024, accounting for just 1.7% of China’s total vehicle exports, data from the US Department of Commerce showed.
Imports of China’s electric vehicles could face a steep rise in tariffs as the US already quadrupled tariffs on Chinese-origin EVs to 100% in September 2024, China-based sources said.
The US tariff hikes would intensify uncertainty in global trade markets, which could weaken China’s exports of manufactured goods, including vehicles, according to China-based steel market sources.
Europe
Tariffs on automobiles are likely to impact European steel producers and service centers linked to the auto industry, especially given the existing 25% tariffs on their products.
The auto industry is the second-largest consumer of steel, accounting for 17% of steel procurement in the EU.
Germany, the fifth-largest vehicle exporter to the US, shipped 446,556 cars to the US in 2024, making it the most-affected European country, followed by the UK and Slovakia.
Prices
Tariffs could potentially increase steel prices in the US due to reduced supply. Platts, part of S&P Global Commodity Insights, assessed the daily TSI US HRC index at $940/st on an ex-works basis on April 2, up 3% month over month.
European flat steel is likely to come under pressure as the US remains an important market.
Platts assessed HRC in Northwest Europe at Eur640/mt ex-works Ruhr April 2, up 4% month over month, while CRC prices in Northwest Europe were assessed up 3% month over month at Eur715/mt ex-works Ruhr.
HDG ex-works Ruhr prices were assessed at Eur725/mt April 2, with both HDG and CRC demand remaining poor amid weaker automotive and OEM purchasing and higher offers being reported.
China’s flat steel market, especially cold-rolled coil, is likely to be supported by robust vehicle manufacturing at least in the first half of 2025, led by domestic fiscal stimulus and a still-strong export market.
The average spread of Chinese domestic CRC prices to hot-rolled coil in Shanghai was Yuan 630/mt ($87/mt) on April 2, higher than Yuan 510/mt a year earlier, Platts data showed. The production cost to roll HRC into CRC is usually around Yuan 400-500/mt.
| Asia, Europe’s large presence in US as passenger vehicle exporters | |||||
| Countries | 2020 | 2021 | 2022 | 2023 | 2024 |
| Mexico | 21,86,483 | 21,34,494 | 22,80,577 | 26,44,089 | 29,61,598 |
| South Korea | 8,73,939 | 8,24,447 | 9,37,354 | 12,42,834 | 15,35,616 |
| Japan | 13,88,923 | 13,34,795 | 12,95,805 | 14,53,815 | 13,77,086 |
| Canada | 11,60,286 | 9,10,519 | 10,10,546 | 12,99,189 | 10,65,465 |
| Germany | 2,78,810 | 2,79,702 | 3,28,671 | 3,90,950 | 4,46,566 |
| China | 36,742 | 50,658 | 64,430 | 69,809 | 1,06,592 |
| United Kingdom | 1,34,081 | 1,29,584 | 81,510 | 73,705 | 96,451 |
| Slovakia | 68,424 | 61,340 | 71,640 | 99,575 | 93,301 |
| Sweden | 69,558 | 78,539 | 74,633 | 84,691 | 87,707 |
| Hungary | 36,629 | 36,981 | 36,381 | 48,482 | 53,828 |
| South Africa | 16,032 | 21,613 | 30,794 | 37,791 | 50,886 |
| Thailand | 19,866 | 20,557 | 19,508 | 17,833 | 35,615 |
| Belgium | 30,663 | 29,897 | 37,120 | 52,517 | 34,179 |
| Italy | 89,743 | 55,154 | 50,969 | 65,113 | 27,649 |
| Volume in units | |||||
| Source: US Department of Commerce, Bureau of the Census, Foreign Trade Division | |||||
Annalisa Villa | Jing Zhang | Market Specialist – Metals | Clement Choo | Lucy Tang | Market Specialist – Metals
HRC prices strengthen within the EU
European domestic hot-rolled coil prices rose April 3 as sources discussed the impact of the latest US tariffs and the underlying bullish supply-side factors driving the market.
Although spot liquidity remained thin, higher mill offers continued to captivate market participants’ attention April 3, as responses to the latest round of US tariffs were largely mixed about the scope of the impact.
In response to higher offers, a mill source, seeing the market closer to Eur650/mt ex-works Ruhr, said, “We had heard some other participants increase their offers by Eur10, but in reality, nobody is paying much higher than that, Eur700/mt seems unreachable, at last, for now.”
A distributor discussing the latest US tariffs shared expectations of a minimal price impact but rather further contributions to the uncertain atmosphere among buyers and traders amid a volatile US dollar. “I don’t think it will have devastating developments, and the EU steel industry will digest this quite easily—maybe we’ll see more emotional reactions or an impact on specialized steel flows, at most,” the distributor said.
In response to higher EU mill offers, the same distributor said, “Eur700/mt [EXW Ruhr] is not workable yet, but the market is moving to a closer balance on industry demand and production as capacity falls.”
Other market participants pointed to hesitancy to buy imports due to the quota risk at the moment amid expectations that, with the lower limits’ prices, the refreshed quarterly quotas will close significantly sooner than in prior quarters despite limited demand.
This is anticipated to add further support to domestic producers, with several midstream buyers suggesting that prices for HRC could hit Eur700/mt and above in Northern Europe in the second half of the year.
Platts, part of S&P Global Commodity Insights, assessed HRC in Northwest Europe at Eur645/mt EXW Ruhr April 3 and HRC in Southern Europe at Eur630/mt EXW Italy, both up Eur5 from April 2.
Platts assessed HRC CIF Antwerp at Eur550/mt and HRC Southern Europe at Eur545/mt CIF Italy, stable with April 2.
UK HRC market sideways as ex-EU offers climb
The UK hot-rolled coil prices remained stable on April 3, as sources pointed to generally higher offers but limited spot inquiries and caution amid an uncertain geopolitical picture.
Offers from European mills increased further in the week, with offers heard as high as GBP570-595/mt DDP West Midlands. Imports from Turkey and South Korea were reported slightly lower, at a range of GBP535-550/mt DDP West Midlands, but with slightly further out delivery timings. Sources stated that there continued to be a large oversupply of material for current demand dynamics.
“There are a lot of new prices which haven’t really made sense,” said one service center source. “It has really slowed down on buyers’ side, we also aren’t buying from traders at the moment due to quota risks.”
Other market participants pointed to additional uncertainty due to the volatility of the US dollar, which is further limiting liquidity in the import market.
One buyer reported increased confidence from industrial applications, but overall referred to typically negative sentiment within the wider market as demand in downstream sectors remained largely weaker.
Platts assessed UK HRC at GBP530/mt DDP West Midlands, unchanged week over week.
Platts is part of S&P Global Commodity Insights.
Tubos Reunidos develops hydrogen distribution pipe
Spanish seamless tube supplier Tubos Reunidos (TR) is developing pipe capable of transporting hydrogen. As part of its participation in the H2Bidea project, the company aims to support the expansion of green hydrogen valleys and industrial decarbonisation in Spain, Kallanish notes.
“We are constantly improving our processes and products to make them more sustainable,” explains TR R&D director Jon Bikandi. “The Group is developing carbon steel piping capable of distributing 100% hydrogen at up to 160 bar, which currently does not exist. This proves that we can reduce our carbon footprint while also driving industrial decarbonisation and building a green value chain for businesses.”
The project is being led by a Basque consortium including Nortegas, Tubos Reunidos, Arizaga, Bastarrica y Compañía (ABC Compressors), Orkli, Comercial de Aplicaciones Electrónicas (Fidegas), and Calcinor Servicios.
Supported by the Basque government’s Hazitek R&D programme and the European Union, the project aims to be completed by 2027, culminating in the H2TESTLAB distribution network demonstration, a dynamic circuit designed to assess damage tolerance in hydrogen-compatible components.
Todor Kirkov Bulgaria