Prices of EU coil mills keep giving in – but only slightly and slowly – not least because the influence of imports remains limited, despite considerable gaps.
“Even with the addition of the EU’s import levy, there was still a difference of approximately €150/tonne ($158/t) in April to the advantage of Asian prices,” a Dutch manger notes. The extremely high prices in Europe have local causes – extremely high energy and scrap prices for many months, aggravated by the war in the east. Hence, they have risen by their own rules, and detached from the international level, many observers say.
Still, the disappearance of relatively reliable source countries Ukraine and Russia has strengthened mainly the local central and western European mills – and Turkey. The country “is less influenced by Russia because it traditionally sources slab from China,” a trader tells Kallanish. This explains unusual moves reported by Turkish trade data like a delivery of 15,000 tonnes of hot-rolled coil to Switzerland, a rather unusual destination for Turkish steel.
Imports for cold-rolled and hot-dip galvanized coil are offered between €1,100-1,200/t cif Antwerp, with especially low prices from Vietnam, compared to the €1350-1,400/t from EU mills, according to the trader. But then, Vietnam is on the verge of losing its transitory special status and soon may face the same duties as others, he says. With the new year for safeguards commencing on 1 July, “it will be difficult finding a source country without a safeguard risk.”
Finally, the Dutch manager points out that there is still the risk that the dollar-to-euro ratio will gradually creep closer to 1 to 1, which will increase import prices and make imports less attractive.
Christian Koehl Germany
