Although participants reported bullish expectations for the automotive sector in 2023, the European downstream coil market continued on a bearish trend on the week, with competitive domestic offers reported Nov. 23.
Cold-rolled coil remained a problematic product for domestic mills, with prices driven lower on poor demand. Domestic offerings were heard below import prices. Platts assessed North European CRC down Eur20 on the week at Eur710/mt ex-works Ruhr.
The South European market showed a similar decline, with Platts assessing the price in that region at Eur700/mt ex-works Italy, down Eur20 on the week.
Galvanized coil in Northern Europe fell Eur30 on the week to Eur740/mt ex-works Ruhr, while South European prices fell Eur25 to Eur725/mt ex-works Italy.
While traders reported difficulty in securing volumes due to the effective parity between domestic and import offerings, sentiments were not overly bearish due to buyers’ expectations for a domestic price increase.
Market participants witnessed some restocking in the Italian market week beginning Nov. 21, with the expectation that domestic prices would rise in the near-term. Traders held this as a bullish indication for near-term demand, as buyers considered locking in cheaper forward material against a potential uptrend.
Sentiments in the North European market were more tied to prospects of the automotive sector, which was in negotiation with European mills for long-term contract settlements.
As the sector has not been taking volumes at traditional levels, producers more exposed to automotive trade were offering particularly aggressively on downstream products.
However, while automotive demand was not quite at desired levels for mills, a mill source was more optimistic for performance in 2023.
“Semiconductors aren’t as big an issue anymore, and OEMs have a relatively strong pipeline and supply chain,” the source said. “The weekly consumption or orderbook is at a pretty good level – it suggests that underlying demand is there so in many ways we’re confident looking forward to next year.”
The same source said that current volumes were relatively stable and strong through November-December for automotive and other customers.
“2023 won’t set any records, but expectations are positive,” the source added.
Platts is part of S&P Global Commodity Insights.
— Benjamin Steven
