European downstream flat steel prices continued climbing in the week to Wednesday January 21, but recent gains were mainly attributed to import-curbing regulatory pressure, rather than a real pickup in demand, sources told Fastmarkets.
Earlier this week, ArcelorMittal came to the market with higher offers for hot-rolled, cold-rolled and hot-dip galvanized coil across Europe, Fastmarkets reported.
Notably, offers for April-delivery HDG from the supplier were reported at €820 ($963) per tonne base delivered (around €805 per tonne ex-works), compared with €780 per tonne base delivered for March.
And for CRC, offers were reported even higher — at €830 per tonne base delivered (€815 per tonne ex-works) for April lead times.
The market was still digesting the increase, but most buyer sources in both Southern and Northern Europe continued reporting lower tradable prices for both CRC and HDG.
Northern Europe
Buyers in Germany and the Benelux area estimated workable levels for CRC at no higher than €740-760 per tonne ex-works during the week to January 2 — pretty much in line with the previous assessment period.
Some transactions were reported within the mentioned range.
One integrated mill in the region reported target offers at €770-780 per tonne ex-works for April-delivery CRC so far.
Another supplier was aiming for €780 per tonne ex-works.
Most of the suppliers in the region were sold out for the first quarter delivery CRC, Fastmarkets heard.
The CRC market in Europe is traditionally mainly dominated by imports, especially in the commodity grades segment, but recent regulations developments — notably an anti-dumping investigation, targeting CRC originating in India, Japan, Taiwan, Turkey and Vietnam, and covering around 65% of the EU’s total CRC imports — curbed import options.
On top of that, the Carbon Border Adjustment Mechanism (CBAM) rollout as of January 1 also limited new imports.
Therefore, stronger reliance on European suppliers allowed them to close first-quarter order books quite fast, sources said.
Fastmarkets’ weekly price assessment for steel cold-rolled coil, domestic, exw Northern Europe was €740-760 per tonne on Wednesday, widening upward from €740-750 per tonne the previous week.
For hot-dip galvanized coil, offers in Northern Europe were reported at €780-805 per tonne ex-works for April lead times.
Italy-origin HDG was offered to Germany at €770-780 per tonne base delivered.
So far, tradable prices for HDG across Europe have also remained below ArcelorMittal’s target offers — with recent trades in Northern Europe reported at €750-770 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil, domestic, exw Northern Europe was €750-770 per tonne on Wednesday, narrowing upward from €745-770 per tonne a week earlier.
Southern Europe
In Southern Europe, especially in Italy, domestic CRC availability was tight due to limited number of suppliers.
Notably, in Italy, deals for CRC were reported at €770-780 per tonne ex-works during the assessment week.
“There is only one CRC supplier in Italy, and almost no new imports. So, CRC price increase is even outpacing HDG,” a buyer in Italy said.
“There is practically no import availability — since over half of traditional import is under anti-dumping investigation, and on top of that we have CBAM and safeguards. This [regulation pressure] is the only driver for domestic price increase,” a second buyer said.
Fastmarkets’ weekly price assessment for steel cold-rolled coil domestic, exw Southern Europe was €770-780 per tonne on Wednesday, rising by €10-20 per tonne from €750-770 per tonne heard in the previous week.
Meanwhile, Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil, domestic, exw Southern Europe was €760-780 per tonne on Wednesday, widening upward from €760-770 per tonne during the previous week.
During the assessment week, transactions were reported in Italy, Spain and Portugal within the mentioned range.
Sources were not ruling out further price rises in the upcoming weeks.
“Maybe ArcelorMittal’s move [to increase prices] was too soon, but we expected it. And buyers do not have many options to choose from,” a buyer in the Iberian market said.
Imports
In the meantime, the market for overseas coil was broadly quiet over the past seven days, with CBAM, ongoing anti-dumping investigations and expected change steel safeguards measures significantly curbing buyer’s appetite for overseas steel.
New offers were scarce — for both CRC and HDG coil, source said.
“For CRC, all traditional suppliers [India, Japan, Taiwan, Turkey and Vietnam] are under anti-dumping investigation, so we avoid booking from them. And for other there are CBAM costs, which are more or less manageable only for Brazil maybe,” a second buyer in the Iberian market said.
During the assessment week, an offer for Thailand-origin CRC was reported at €655 per tonne CFR to Italy, excluding CBAM costs.
And CRC offers from South Korea was reported at €750-760 per tonne DDP in Spain, versus €725-730 per tonne DDP before Christmas. No fresh deals were reported so far.
Buyers estimated achievable prices for imported CRC at €720-730 per tonne DDP.
So far, to manage unpredictable CBAM costs, European buyers were prioritizing import bookings on a DDP basis — which at least partially accounted for CBAM costs of imported goods, but deals were still rare.
Fastmarkets’ weekly price assessment for steel cold-rolled coil, import, ddp Southern Europe was €720-750 per tonne on Wednesday, rising from €700-725 per tonne seven days earlier.
