European coils stock levels to rise over summer on incoming imports

The European HRC market continued to fluctuate July 6, with prices heard slightly higher as limited supply and an absence of spot mill offers left prices hanging in the balance.

The market is looking to determine the outcome of prices following cheaper import offers, with the impact of lower prices mostly felt in Italy, sources told S&P Global Platts.

Buyers were heard to be using imports as leverage in their negotiations with mills. HRC import prices were heard in the vicinity of Eur1,070-1,080/mt CIF Antwerp.

A European service center source noted there was a lack of CRC domestically and from imports, with Q3 booked up and Q4 orders nearing their close. If buyers booked material today, they could expect delivery of orders for October-November.

“Backlogs are gone, people are telling me stock levels are huge. All mills are catching up,” the source said.

Meanwhile, a German distributor source said to expect EU prices to remain stable, with HRC import offers softening slightly. Stock levels were expected to rise during the summer with incoming import material awaiting customs clearance.

“We need to see what happens after material cleared by customs, that should be done in 2-3 days, [stock levels] might be higher because of customs cleared import tonnage,” distributor said.

The source said he did not expect prices to soften due to the extended lead times and ongoing production issues experienced at several European mills.

“I have doubts that we’ll see a price decrease. Everyone will try to negotiate, but [with difficulty] given the current state on the worldwide market and reduction of steel exports from China, high US prices and Russian tax on steel exports,” the distributor said.

In the Italian market, a distributor said that although several mills were accepting prices in the range of Eur1,080-1,100/mt ex-works Italy, he said buyers should remain cautious due to antidumping investigations and limited quota allowances.

— Amanda Flint