European plate prices saw sharp increases March 11 due to upstream supply illiquidity, largely due to the war in Ukraine, with buyers prioritizing guaranteed delivery over negotiations on price.
EU plate prices hit record levels again March 11, with the Platts assessments for Northern and Southern European plate rising Eur400 on the day.
With slab supply so tight given the EU market’s dependence on CIS area material, plate products were subjected to particular pressure following Russia’s invasion of Ukraine. Rising energy costs were also said to be a major factor.
“Heavy plate is the biggest focus for the market at the moment, followed by hot-rolled coil — everyone is desperate for new sources of supply,” said an Italian distributor source.
“It’s difficult to be in line with client expectations given the lack of necessary materials.”
The source described high acceptance rate on offers, with little negotiation on tradable levels: “I see no negotiation on price anymore, if material is guaranteed, then people will accept offers.”
An Italian mill source agreed, offering, “if you need to buy in this market, you will pay any price”.
In discussing alternative supply sources, market participants considered imports non-feasible.
“Short lead times are off the table, imports may be priced competitively but June delivery may be too late for required inventories,” said a mill source. “it’s a really desperate situation.”
A Nordic buyer said they were avoiding the plate market but reported concern that existing contracts could be cancelled.
“We haven’t seen a situation like this in 15 years,” the buyer said.
A German distributor was also worried about delivery of contracted material.
“Most mills are out of the market due to slab shortages, everyone has full orderbooks but there are significant doubts whether these orders will be fulfilled,” the distributor said.
Platts assessed North European plate at Eur1575/mt ex-works Ruhr March 11 and South European plate at Eur1500/mt ex-works Italy.
— Benjamin Steven