The European hot-rolled coil market remained quiet on Friday November 4 with minimal trading activity reported because destocking among buyers was still not accomplished, Fastmarkets has heard.
Fastmarkets calculated its daily steel HRC index, domestic, ex-works Northern Europ, at €647.50 ($632.99) per tonne on November 4, up by €1.25 per tonne from €646.25 per tonne the previous day.
The latest calculation of the index was down by €12.25 per tonne week on week and down by €100.00 per tonne month on month.
Traded volumes remained low in the region, with distributors and steel service centers still being more focused on selling their expensive stocks of HRC, rather than purchasing new volumes.
Producers’ estimates of achievable prices were closer to €650 per tonne exw in the region, while buyers gave lower indications at €630-650 per tonne exw.
“It is hard to say what the price is when no trading is going on,” a steel mill source in the region told Fastmarkets.
In the face of challenging market fundamentals, ArcelorMittal has announced one more blast-furnace stoppage, at Fos-sur-Mer in France, Fastmarkets reported.
At the same time, several trading sources reported that the producer was purchasing steel slab from Brazil and other areas to keep its hot-rolling mills working.
Market sources agreed that more steelmaking output cuts in Europe were needed to balance supply and demand.
Fastmarkets’ calculation of its daily steel HRC index, domestic, exw Italy was €665.00 per tonne on Friday, up by €5 per tonne from €660.00 per tonne on Thursday.
The latest calculation of the Italian index was down by €12.00 per tonne week on week and down by €83.75 per tonne month on month.
Italy’s HRC market was more balanced, sources said, because the production cuts there had been more substantial than in Northern Europe.
“For the first time in years, we have a situation in which Italy’s HRC is traded at a premium compared with the Northern European market. We clearly can see the effects of the steelmaking reductions in Italy,” a source at a steel service center in Italy said.
Offer prices from Italy’s integrated mills were reported at €670-700 per tonne exw, while re-rollers’ offers were at similar levels of €660-680 per tonne exw.
Italian producers were reluctant to give discounts, citing reduced volumes and “biting” costs.
Trading activity in Italy’s market was also quiet. Buyers were still holding back, with the overstocking problem persisting.
Cheap import offers were also adding pressure on the domestic price.
Notably, HRC offers from Japan for January shipment were reported at €600 per tonne CFR.
Offers from other suppliers in Southeast Asia were reported at a similar level of €600-610 per tonne CFR.
“China has been really aggressive recently,” a trading source in Italy told Fastmarkets, “so suppliers from Southeast Asia are trying to increase their presence in the European market.”
– Julia Bolotova
