EU HRC prices stable as market doubts September salvation

The European hot-rolled coil market remained uncertain on price direction Aug. 18, given rising input costs in a quiet market environment.

Platts assessed hot-rolled coil in Northern Europe stable Aug. 18 at Eur750/mt ex-works Ruhr.

Distributor sources reported tradable value at Eur750/mt ex-works Ruhr, though the market was heard as extremely quiet given the ongoing holiday period. Offers were heard on a range of Eur750-800/mt ex-works Ruhr, though market participants did not interpret this as indicative of an uptrend.

A strong wait-and-see sentiment was identified as the market moved into late August, with only a few weeks left before the traditional restocking period in September.

However, stockholders continued to report high stock levels due to prebooked and incoming import material — as well as poor end-user demand — meaning that most deny intention to restock substantially for the remainder of the year.

“We have no problems getting stock anywhere,” a distributor said. “Our sales are picking up a bit and inventories are going down to the point we can look at replenishment, but not for this year, to be honest.”

Price direction is very uncertain, with poor demand and rising production costs pushing the market on both sides. Some mills were heard as offering with the condition that prices could include variable extras on energy costs at time of delivery, but this was not agreed on by buyers or widespread in the market on the day.

“It’s very quiet at the moment,” another distributor source said. “Everyone’s waiting for something to happen, be that a price rise or further decline. There’s been some attempts to put something on the table in terms of base price increases or extras for energy or transport, but this was more to gauge reception from buyers than it was any attempt to lead the market in an upward direction.”

Given ongoing uncertainties in the market and recent devaluation of material, buyers were heard as requiring firm offer prices in negotiations — resistant to flexible surcharges to absorb mill costs downstream.

The Italian market remained silent, with tradable value indications continuing to surround Eur720/mt ex-works Italy — the unchanged Platts assessment on the day.

— Benjamin Steven, Maria Tanatar