Prices for domestic steel hot-rolled coil (HRC) edged up in Northern Europe day on day amid rising production and energy costs, while levels declined in Italy despite the tight supply in the market, sources told Fastmarkets on Wednesday September 16. Rising prices were also seen in the domestic markets of Spain and Central Europe, and were reflected in imports into Southern Europe.
In Northern Europe, trading activity was slow as end-user demand remained weak, while mills were under pressure due to higher production and energy costs, sources said.
The latest indications for workable levels were reported within the range of €730-750 ($842-865) per tonne ex-works, with one trade source pointing to €750 per tonne ex-works as the realistic level for deliveries of basic grades and sizes in October.
The same source expected customers to pay €760-770 per tonne ex-works for contracts in the fourth quarter.
Meanwhile, a distributor was pessimistic about such price increases. “Problem is that demand is low and there is extremely expensive energy,” the same source said, adding that electricity costs in Europe had risen by more than 50% in the last four months.
The distributor said that price increases were initiated by mills to cover the production costs, while there was no significant import activity due to the reduced import quotas and higher out-of-quota duties.
Latest offer for HRC imports into Northern Europe was reported at $700 per tonne CFR from India on Tuesday, or around €605 per tonne CFR, but no fresh trading activity was confirmed.
As a result, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe was calculated at €745 ($859.63) per tonne on September 16, up by €6.67 per tonne from €738.33 per tonne on September 15.
The index was down by €5 per tonne week on week but up by €26.25 per tonne month on month.
Meanwhile, in Italy, no significant trading activity was reported as well, while sources said customers were not worried about the tightening supply in the market for now.
On Friday, the Court of Appeal of Milan confirmed the shutdown order for the hot-end area at the former Ilva works in Taranto by October 28, while Metinvest’s Ferriera Valsider mill had not resumed offerings for HRC yet.
Latest offers in the market were reported at €750 per tonne delivered, which nets back to €730 per tonne ex-works, while indications for workable levels were heard in the range of €720-730 per tonne ex-works.
A second distributor said that mills were open to negotiate a discount of €15-20 per tonne from offer at €730 per tonne ex-works, which results in around €710-715 per tonne ex-works. However, other sources could not confirm these lower levels, and they were discarded from the daily index calculation.
Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €728.33 per tonne on September 16, down by €7.50 per tonne from €735.83 per tonne on September 15.
The index was down by €4.17 per tonne week on week but up by €14.58 per tonne month on month.
HRC imports into Southern Europe
In the import segment, most suppliers also raised prices after several rounds of successful sales, sources said on Wednesday.
Turkish material was heard available within the range of €550-560 per tonne CFR in the reported week, narrowed upward from €540-560 per tonne CFR, with 40,000 tonnes cargo reported sold within €550-560 per tonne CFR.
Indian offers moved well above $700 (€606) per tonne CFR from $650-655 per tonne CFR seen in late August.
Most recent offers were heard within the range of $715-740 (€620-641) per tonne CFR in the reported week, with small tonnage deals reported at the lower end of the range.
Egyptian HRC was offered at $750 (€623-627) per tonne CFR, including Carbon Border Adjustment Mechanism (CBAM)-related costs of $25-30 per tonne, with customers bidding for $725 per tonne CFR.
Excluding CBAM costs, the price would net back to €695-700 per tonne CFR. This price was used in the calculation of Fastmarkets’ weekly assessment of steel hot-rolled coil import, cfr main port Southern Europe, which excludes all types of duties.
The assessment was €550-620 per tonne CFR on September 16, up from €540-585 per tonne CFR on September 9.
HRC domestic market in Spain, Central Europe
In Spain, sellers managed to achieve higher levels for HRC material of €750-760 per tonne delivered (€730-740 per tonne ex-works) in the first half of September and were now targeting higher prices amid tighter domestic and import availability.
Buyers said that suppliers no longer agree to sell material at the abovementioned levels, and were offering €790 per tonne delivered (€770 per tonne ex-works), but were ready to discuss €760-770 per tonne delivered (€740-750 per tonne ex-works).
Fastmarkets’ weekly price assessment for steel hot-rolled coil domestic, exw Spain was €730-750 per tonne ex-works on September 16, widened upward from €730-735 per tonne ex-works on September 9.
Fastmarkets’ weekly price assessment for steel hot-rolled coil domestic, exw Central Europe moved to €730-740 per tonne on September 16, up from €720-730 per tonne on September 9, in line with recent transactions heard in the market.
Sources reported deals from all major suppliers within the range of €750-760 per tonne delivered or CPT, which corresponds to €730-740 per tonne ex-works.
Meanwhile, mills were targeting higher levels of €770 per tonne delivered, or €750 per tonne ex-works, amid tighter domestic and import availability.
