EU HRC buyers hold back from trading, anticipating price decline

Activity in the European hot-rolled coil market was subdued May 11 as buyers avoided bookings after recent import price declines, believing that prices have not yet bottomed out.

Major domestic mills, particularly in Northwest Europe, have not been offering coil due to full order books and effects from either technical issues or planned maintenances at the plants. Some sources said that those mills are unlikely to return to the market this month.

“Big mills now can offer September delivery, which puts them in direct competition with Asian import as the lead times are similar,” an Italian service center source said. “And the import is at least Eur100/mt cheaper than domestic material, so European mills will have to decrease. Obviously, there is a chance that by the time they return to the market, import prices would recover. But the situation might be different. We might see further price decline for import.”

A service center source shared similar information, saying that “all big integrated mills from North Europe informed customers that they will not give offers until July. Then they will start offering September delivery.”

Platts assessed prices for imported hot-rolled coil in South Europe at Eur620/mt CIF Italy May 11, down by Eur10/mt day on day.

Offers have been reported at Eur600-650/mt CIF for the material from Asia. Majority of source, however, said that the prices of Eur640-650/mt CIF were no longer present in the market and the exporters have decreased the prices.

Platts assessed prices for domestic hot-rolled coil in South Europe down by Eur25/mt on day to Eur750/mt ex-works Italy May 11.

Deals for smaller lots of coil, offers and tradable values have been heard at Eur750/mt ex-works Italy.

Platts assessed domestic prices for hot-rolled coil in Northwest Europe at Eur800/mt ex-works Ruhr on May 11, unchanged day on day.

The assessment was based on tradable values reported at Eur790-800/mt ex-works Ruhr, while majority of the sources estimated achievable prices at the upper end of the range.

Platts is part of S&P Global Commodity Insights.

Author Maria Tanatar