EU mills avoid HRC price decline despite competitive imports

European mills have been holding back from making offers, and the few offers available remained stable May 3 despite competitive import prices and sluggish demand.

Buyers have been avoiding bigger volume purchases or have turned to imported coil from Asia, as prices for the overseas material have been over Eur100/mt below the domestic HRC.

“Everyone who wants to buy is buying from import,” a Benelux-based service center source said. “And European mills hold offers high, claiming that they have good order books.”

Lead times from both European and Asian mills have been similar — August-September delivery. The domestic supply has been reduced due to effects from technical issues and planned maintenances at some plants.

Although European distributors have lower stocks, they are unlikely to accept higher prices from domestic mills due to limited end-user demand and an influx of imported coil arriving in the EU soon, sources said.

Some market participants suggested that the steelmakers have kept spot prices stable to negotiate long-term contracts at higher prices despite the bearish market. A couple of market sources said mills have been holding back from the market until exporters exhaust the third quarter safeguard quota and would no longer be able to export bigger volumes.

Platts assessed prices for imported hot-rolled coil in Northwest Europe at Eur690/mt CFR Antwerp May 3, unchanged day on day.

The assessment was based on a deal heard at around Eur690/mt CIF Antwerp for the material from Japan and offers reported at Eur680-700/mt CIF Antwerp for the coil from Asia.

Platts assessed domestic hot-rolled coil prices in the region at Eur820/mt ex-works Ruhr on May 3, also stable day on day.

A majority of market sources reported achievable prices at Eur810-830/mt ex-works Ruhr. Offers have been reported at Eur830-845/mt ex-works Northwest Europe. One source also said that with current import offers, domestic prices should be around Eur760/mt ex-works Ruhr to spur buyers’ interest.

Platts assessed domestic prices for hot-rolled coil in South Europe stable day on day at Eur800/mt ex-works Italy May 3, reflecting achievable prices reported at Eur800-810/mt ex-works Italy.

Platts assessed prices for imported hot-rolled coil in the region at Eur670/mt CFR Italy May 3, unchanged day on day. Offers of the material from Asia have been heard at Eur660-680/mt CIF Italy.

Platts is part of S&P Global Commodity Insights.

Author Maria Tanatar