European domestic prices for hot-rolled coil were unchanged on July 27, with market participants seen evaluating the impact of unplanned production cuts.
Platts assessed domestic prices for hot-rolled coil in Northwest Europe stable on the day at Eur670/mt ex-works Ruhr on June 27.
Market participants estimated tradable values at Eur660-700/mt ex-works Ruhr with a majority of achievable prices reported at Eur660-680/mt ex-works Ruhr.
On June 27, German steelmaker Salzgitter issued a notice of force majeure to its customers, saying that recent heavy rain and local flooding have damaged roads and rail tracks, affecting its ability to ship raw materials and dispatch steel goods.
Labour Inspectorate also ordered ArcelorMittal France to temporarily close its production at Fos-sur-Mer June 23 due to high levels of emissions threatening the health of workers. The company has started to prepare for the shutdown of the steel mill and site facilities, but it is scheduled to have a meeting with French authorities in early July to discuss an action plan.
“Fos-sur-Mer will most likely have to lower production, as it is the easiest and the fastest way to reduce emissions,” a service center source said. “This situation and the recent announcement of Salzgitter will be used by mills to increase offers. Most likely prices will remain stable or move up slightly, as demand is not great. But at least the negative sentiment about prices will disappear from the market.”
In addition, Hungarian-integrated steelworks Dunaferr has suspended rolling operations because of a lack of slabs with a restart tentatively scheduled by mid-July.
Majority of the European steelmakers expect to have longer summer maintenance to balance supply and demand, according to sources.
Although downward pressure from new import offers has disappeared due to a limited number of offers, uncompetitive prices and longer lead times, large volumes of cheap import coil are currently on the way or crossing borders of the EU, they added.
Offers of HRC from Asia were reported at Eur630/mt CIF European ports.
Platts assessed domestic prices for hot-rolled coil in South Europe at Eur645/mt ex-works Italy on June 27, stable on the day.
The assessment was based on deals heard at Eur640-650/mt ex-works Italy. The mills, however, were seen trying to increase offers to Eur670-690/mt ex-works Italy.
Platts is part of S&P Global Commodity Insights.
Author Maria Tanatar
