EU buyers avoid HRC bookings amid anticipated price decline

European buyers have continued to avoid hot-rolled coil bookings on Feb. 29 due to pessimistic price outlook and limited end-user demand.

While demand remained low, production has been higher due to restart of the blast furnaces idled last year, sources said. As a result, the mills have been struggling to fill order books and still have been offering April-May delivery coil.

“Nobody wants the price decrease, it would depreciate existing stocks [of distributors],” a German service center said. “But as the mills keep production high the price drop is inevitable. So, everyone knows that the current stability is fragile, and it is not supported by either supply or demand.”

Platts assessed domestic prices for hot-rolled coil in Northwest Europe stable on the day at Eur715/mt Feb. 29.

Market participants estimated tradable values at Eur700-730/mt ex-works Ruhr. Offers from integrated mills have been heard at Eur730/mt ex-works Ruhr and from a re-roller at Eur690/mt ex-works Benelux.

Platts assessed domestic prices in South Europe down Eur25/mt on the day at Eur885/mt ex-works Italy on Feb. 29.

An Italian steelmaker has been offering HRC at Eur690/mt ex-works Italy and tradable values have been heard at Eur680-690/mt ex-works Italy.

Some market sources believe that the production cuts and furnaces stoppages are needed to prevent the coil price collapse.

“The mills need to cut the production as otherwise they would need to sacrifice the prices,” a Northwest European service center said. “And even that would not help to fill the order books as demand is low.”

Interest in imported coil has been limited as safeguard quotas for the second quarter are expected to be filled for Asian material within the first few days of April. In addition, importers have been avoiding the overseas material dur to risks with potential changes made during the safeguard review. In early February, the European Commission started the review of the safeguard measures, that can result in the extension for two more years — until mid-2026.

Platts assessed prices for imported hot-rolled coil in South Europe down Eur10/mt on the day at Eur610/mt CIF Italy Feb. 29.

“Offers of Eur620/mt CIF [Italy] from Asia are rejected by buyers, some bids are below Eur600/mt CIF [Italy] for small volumes. But the buyers are not interested in actually buying they are just testing how low the prices could drop,” a trader said.

Platts assessed prices for imported hot-rolled coil in Northwest Europe down Eur20/mt on the day at Eur614/mt CIF Antwerp Feb. 29.

Offers have been heard at Eur615-650/mt CIF Antwerp.

Author Maria