European value-added coils prices remained on a slight downtrend Aug. 17, resisting upward pressures from rising energy costs.
In Northern Europe, prices for downstream coils edged down further, with particular pressure on galvanized material.
For hot-dip galvanized coil, market participants reported workable prices on a range of Eur860-900/mt ex-works Ruhr. Platts assessed HDG at Eur880/mt ex-works.
Some German mills have been heard as offering HDG at very competitive prices in order to secure volumes in the low demand market, requiring fresh orders to test new galvanizing lines. The market has followed these offers down to a sub-Eur900/mt tradable level, ex-works Northern Europe.
As a key industry for HDG, automotive continues to struggle with semiconductor shortages, though distributor sources reported a degree of recovery in the sector.
“The automotive sector is running relatively well given established issues,” said a distributor source. “They have full orderbooks for the next two years due to the pandemic and semiconductor problems, but it’s hard to say what will happen in the next six months.”
However, a service-center source clarified that the impact from better OEM orderbooks on steel consumption remained low due to a preference from automakers to prioritize production of more expensive, luxury models – where end-user demand is less degraded by the current macroeconomic picture.
In the cold-rolled coil market, the picture was bleak, with little to no trade heard on muted demand.
“There is nobody interested in CRC,” said the service-center source. “Thus, we have no price and no market.”
Due to rising energy and production costs, two smaller cold-rolling mills have been heard as imposing energy surcharges on orders due to exposure to rising natural gas prices – heard at Eur90/mt on the day.
Market participants widely expect some form of price increase in the near-to-mid-term due to increasing energy costs – though whether this will come as a base price adjustment or further surcharges is yet to be seen.
Buyers accepting higher prices is increasingly unlikely under current demand levels, source said.
Platts assessed CRC in Northern Europe unchanged on the day, at Eur870/mt ex-works Ruhr.
In South Europe, the market remains extremely quiet due to production stoppages and the traditional August holiday period. Downstream coils prices are at near parity with Northern levels, also moving down slightly on week.
South European CRC and HDG were assessed by Platts at Eur875/mt and Eur880/mt, respectively, both ex-works Italy.
Platts is part of S&P Global Commodity Insights.
— Benjamin Steven, Maria Tanatar