Market participants polled by Fastmarkets on Friday on both the buying and sell side reported a lack of demand.
“Demand is missing totally. Stocks are sustaining low buying activity. How long can this last? A few months more,” a buyer in Italy said.
“Next year prices will be much higher, but some people still believe that CBAM [Carbon Border Adjustment Mechanism] will not happen or will be postponed, and new protection measures will be changed. Not everyone has understood the situation. I am buying what is possible,” the buyer added.
In addition to uncertainty over regulatory measures, steel output at a mill in Northern Europe will be reduced for around a month, which could create a deficit in the market.
A fire on October 8 at ArcelorMittal Fos-sur-Mer in southern France halted one blast furnace (BF) for at least one month.
On Wednesday October 15, an ArcelorMittal spokesperson told Fastmarkets that the company is organizing a one-month shutdown of the affected BF, although this may be adjusted depending on the progress of repair work.
“Other production facilities will continue to operate continuously or will alternate between periods of operation and shutdown depending on operational requirements and scheduled maintenance,” the spokesperson said.
ArcelorMittal typically operates two blast furnaces at Fos-sur-Mer, with a combined capacity of 5 million tonnes per year of pig iron. The site focuses on HRC and cold-rolled coil production.
This news, nevertheless, had no impact on demand in Northern Europe.
“No one is accepting higher prices so far. Demand is not there,” a trader in Germany said.
“Prices are now just testing. No demand, only uncertainty,” a producer in Benelux told Fastmarkets.
Offers for December-delivery HRC were reported at €600-640 per tonne ($700-747) ex-works or delivered in Germany and the Benelux area, while estimates of workable prices did not exceed €585 per tonne ex-works.
Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe was €591.25 per tonne on Friday, stable day on day.
The index rose by €13.75 per tonne week on week and by €10.00 per tonne month on month.
In Italy, HRC was available at €600-630 per tonne delivered, netting back to €580-610 per tonne ex-works, according to sources.
Meanwhile, estimates of workable prices ranged from €570 to €590 per tonne ex-works, with no major deals heard during the day.
“Bids are at €560 per tonne ex-works, but no mill is accepting this level, so all is dead,” an Italian buyer told Fastmarkets.
“There is still little progress in the cut sheet market. The minimum price is €660 per tonne ex-works and the maximum is around €680 per tonne ex-works. This is not enough for HRC to be booked at €600 per tonne ex-works,” a producer source said, estimating workable prices at €570-590 per tonne ex-works.
Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy was calculated at €580 per tonne on Friday, down by €1.67 per tonne day on day from €581.67 per tonne on Thursday October 16.
The Italian index rose by €35 per tonne week on week and by €27.93 per tonne month on month.
Central European HRC prices increased in the week to Wednesday October 15, following an upward trend observed in other European regions. Workable price estimates hovered at €580-590 per tonne ex-works on Wednesday, compared with €570-585 per tonne ex-works earlier in October.
Offers were also heard at €630 per tonne ex-works, but buyers were not ready to accept those levels.
Fastmarkets’ weekly price assessment for steel hot-rolled coil, domestic, exw Central Europe was €580-590 per tonne on Wednesday, up from €570-585 per tonne the previous week.
Davide Montagner in London contributed to this report.
