European HRC buyers keep holding back from trading, despite lower offers from some mills

Trading remains muted in the European hot-rolled coil market because buyers are focused on reducing their stock levels amid downbeat expectations, sources told Fastmarkets on Tuesday September 12.

Fastmarkets calculated its daily steel HRC index domestic, exw Northern Europe, at €645.00 ($692) per tonne on Tuesday, unchanged from a day earlier.

The index was down by €10.33 per tonne week on week, but up by €0.42 per tonne month on month.

The market for HRC in Northern Europe was silent. Distributors and steel service centers were mostly uninterested in making new bookings and were focused on reducing their stock levels instead, sources said.

“We don’t need to buy [HRC] now, we need to sell,” a distributor in Germany said.

Offers from one German supplier for October-delivery coil were reported at €640-650 per tonne ex-works, for October-November delivery. Buyers’ estimations of tradeable values were in line with those figures, but even so, traded volumes were extremely low.

In general, offers for October/November-delivery coil in the region were reported within the range of €640-685 per tonne ex-works.

One integrated mill in the region reportedly reduced its offers to €630 per tonne ex-works, but this could not be widely confirmed by the time of publication.

An offer from Benelux-based re-roller to Germany was reported at around €630 per tonne delivered.

“It is not the matter of price now, it is the matter of demand, or rather lack of demand,” a buyer in the Benelux area said.

“There is no such thing as a ‘market price’ for HRC because there is no demand,” a steel-service center source in Germany said.

Meanwhile, Fastmarkets’ calculation of its corresponding daily steel HRC index domestic, exw Italy, was €632.50 per tonne on Tuesday, down by €5 per tonne from €637.50 per tonne on Monday.

The Italian index was down by €2.92 per tonne week on week, and down by €1.18 per tonne month on month.

Italian producers were keeping quiet, avoiding giving firm offers in the weak market, sources said.

Several sources confirmed to Fastmarkets that one integrated mill in the nation could still offer HRC with early October-delivery, which indicated very short order books.

A mill source estimated achievable values for HRC in Italy at €640-650 per tonne delivered (€625-635 per tonne ex-works).

Buyers’ price idea was a bit lower, around €615-620 per tonne EXW, but trading in Italy was generally very quiet, sources told Fastmarkets.

“Nobody’s booking [HRC], September will be a month with a very few transactions. Expectations are that an influx of imports in October will dent European prices,” a trading source in Italy said.

Meanwhile, Asian suppliers started offering January-delivery HRC to Europe, but buying interest was quite low in a volatile market.

The lowest offer for November-shipment (January-delivery) HRC was reported from Taiwan at €590-595 per tonne CFR to Southern Europe.

Sources said that one Japanese mill was offering January-delivery coil to Italy at €610-615 per tonne CFR, but Italian buyers deemed such a price level to be unworkable.

In general, buyers in Italy agreed that workable prices for overseas coil should be “way below €600 per tonne CFR” to spur buying interest.

Published by: Julia Bolotova