European coils mills move towards ‘short-time offers’ as hike continues

Buyers’ inquiries for coils availability and prices at European mills are taking longer than usual with offers mostly valid for 24 hours only, sources told S&P Global Platts Sept. 21.

The steady price increases since August in both Northern and Southern Europe have turned mills more optimistic and offers sent to customers are mostly valid for a short period of time as mills ponder hiking prices again.

Buy-side sources said that collecting inquiries sent out to domestic producers is taking longer, or that requests remain unanswered, as more mills are extending lead times or withdrawing from the spot market amid tighter availability.

The Platts TSI Southern European hot-rolled coil index increased Eur4.50/mt on the day Sept. 21 to Eur481.50/mt EXW S. EU, while the Northern European HRC index went up Eur1/mt on the day to Eur491/mt EXW Ruhr.

Some sources are still cautious however, on the sustainability of the upward trend.

“It will be difficult for [price] increases to last, but for now they are continuing,” said a German stockholder.

“At the first smell that the market is going down, it will go down. Consumption is not at pre-covid level and China is starting to export again,” the source added.

For now however, mills are relieved from import pressure and the ramp up of the automotive industry along with higher raw material costs fueled the price uptick since the end of the summer.

“Mills are enjoying it for the moment as they had enough losses, it’s more of a ‘catching-up-increase’ at the moment,” a German buyer said.

Tighter material availability remained apparent in Italy as well as Germany with market participants having mixed anticipations on the ramp-up speed of European mills following production curbs.

Lead times vary from mill to mill and depend on the order situation, but most sources reported delivery times in January, with one source adding that December would be possible from some mills.

— Laura Varriale