EU HRC: Market rises, but sheet still lagging

North European hot-rolled coil (HRC) prices rose today as more buyers entered the market, expecting that the bottom had been reached following the Italian-led upturn.

Argus‘ daily northwest EU HRC index rose by €9.75/t to €622.75/t ex-works, while the Italian index increased by €4.25/t to €609.25/t ex-works.

Mills reported making sales around €630-640/t delivered into the Ruhr, and the market appeared to be more liquid. There was talk that the market leader had increased its offer to €700/t, but this could not be confirmed.

One buyer in the Benelux region tried to increase the volume on an order placed last week with an Italian mill and was told it would have to pay another €20/t, otherwise it would not be possible.

A trader said it finalised a purchase of Japanese HRC below €600/t cfr at the end of last week, but others said mills in the country remained off market. One trader said $620-630/t cfr was the best price from Japan, although Vietnamese HRC could be obtained for $540/t fob — putting a 20,000t vessel together to get freight of around $50/t was difficult, however. Vietnamese cold-rolled coil (CRC)was sold into Antwerp last week around $650-680/t cfr. Indian HRC was offered into southern Europe at $610-615/t cfr, with a deal reportedly done last week around $605/t cfr. Some buyers said around 100,000t has been sold from India into Europe over the past week. Indian CRC was offered at $700/t cfr, while South Korean CRC was quoted at $675/t cfr.

In Italy, where the recent uptick started, service centres said it was proving tough to increase sheet outsell prices, despite efforts to move up offers by €30-50/t. End-user offtake remained static, they said. Italian mills were quoting €610-640/t ex-works today, with some pushing up to €650/t, but after buyers purchased at lower prices in the second half of November activity has been limited, and certainly not at the levels currently targeted by mills. Buyers are expected to reassess the market in the first and second weeks of January and decide what prices to bid at and who to purchase from.

Liberty Galati announced on Monday that it would be taking down blast furnace five, meaning the mill would have no hot metal production and just be rolling stocked slab.

Lora Stoyanova