European hot-rolled coil prices were stable Sept. 2, with pricing uncertainty still rife in a market waiting on the outcome of the potential removal of US Section 232 tariffs come November, and what this could mean for the domestic market, sources told S&P Global Platts.
As mills look to fund carbon-free steel production, and with market chatter around the removal of Section 232 tariffs, prices were expected to increase in the near term.
“Export prices for EU steelmakers will be very good and US prices will decrease for [the removal of] Section 232,” an Italian service center source said. “There is only one loser and that is the European steel industry, which will have less material. It’s important that Brussels understand that the situation is critical – they need to revisit the quota system.”
Buy-side sources were more optimistic about HDG availability, due to the expected lack of demand from automotive manufacturers during September.
Mills were relieved about this unlikely outcome, as it would alleviate the pressure to produce more HDG.
“We have too much in the pipeline to be able to produce anything, so we’re happy automotive haven’t ordered all those [HDG] quantities,” A European mill source said. “It means that we still don’t have a lot of quantities to sell, but we’re not so much in pressure in our production.”
Exporting countries like India were also discontent with the European Commission’s July decision to limit quota allowances, and this was exacerbating the supply pressure felt in the Italian market.
“The Indians want to extend their quotas, and in the past month they discussed with the European Commission, but they didn’t succeed,” the same service center source said. “India is the most important supplier to Italy.”
— Amanda Flint
