EU HRC market quiet as participants look toward Euroblech fair

European hot-rolled coil prices held stable Oct. 5, with market activity still muted given buyer resistance to restocking.

Offers in the Northern European market were heard at Eur730-740/mt ex-works Ruhr and Eur750/mt delivered Ruhr. Market participants saw tradable value in a range of Eur700-740/mt ex-works Ruhr and Northern Europe, with levels approaching Eur700/mt ex-works increasingly heard in the low-demand market.

The latest deals were reported by a distributor source at Eur765/mt delivered Germany, the equivalent of Eur730/mt ex-works Ruhr.

As such, Platts assessed hot-rolled coil in Northwest Europe stable Oct. 5 at Eur730/mt ex-works Ruhr.

Some positivity was heard in the market for the near term, given the approach of the Euroblech fair later this month, with many looking to the event for the settlement of longer-term contracts and the opportunity to bring some clarity to prevalent uncertainties in the market.

“I think most are waiting for the fair now,” a mill source said. “The whole industry is reducing output, so demand and supply will eventually align.”

Indeed, recent price increases attempted in the market were to an extent premised on reduced supply and availability of coil, with one distribution source expecting further cuts given mills could still offer five- to six-week lead times.

“For this quarter we attempted higher prices, which was largely costs driven, but unfortunately this has to be supported by demand which has dried up,” a second mill source said. “Distributors are looking forward at their inventories, and we will see a degree of recovery, but not to 2021 levels.”

In the Southern market, multiple sources reported a preference from Italian mills to stop production rather than cutting prices, in contrast to Northern European mill strategies.

“[Northern] mills are hungry and looking for orders,” a distributor source said. “But in Italy they’ve followed a different strategy — stopping production over discounting volumes. Their offer levels just aren’t realistic, though.”

Platts assessed HRC stable at Eur725/mt ex-works Italy due to a lack of transactional activity to realize the higher offer levels, heard at Eur760-780/mt ex-works Italy.

Platts is part of S&P Global Commodity Insights.

— Benjamin Steven, Maria Tanatar