HRC prices across Europe have been static for over a month amid subdued trading, with all attempts to increase prices by domestic mills largely unsuccessful.
“Since May, the market situation is unchanged. Demand is low, no re-stocking, aggressive sales downstream,” a buyer in Germany said. “European mills were looking for orders to fill order books for July/August, European mills.”
However, with new safeguard measures in place and a lack of cheap imports in the market, some sources suggested that a new attempt to increase prices for September-delivery coil might be successful.
“Some suppliers [in Europe] already opted for modest €20 per tonne increase for September-delivery coil. But in general, mills were keeping quiet. We expect more producers to come back to the market higher, prices in mid-July,” a buyer in the Benelux region said.
“We hope [the HRC] market might pick up late July, and higher prices can be accepted/or partially accepted due to the new safeguards. But this remains to be seen,” the buyer added.
Buyer sources estimated the tradable value for HRC at around €620-630 ($670-680) per tonne ex-works on Friday, in line with the latest booking for July/August-delivery HRC.
Offers for August-delivery HRC were heard at €635 per tonne ex-works from suppliers in the Benelux area.
For September delivery, sources were expecting to see offers of around €670-690 per tonne ex-works or delivered.
Negotiations with the automotive industry for contracts for the second half of 2024 were still under way, sources said, with no progress reported so far.
For the first half of 2024, contracts with original equipment manufacturers in the automotive industry have reportedly been signed at €750-800 per tonne for HRC.
Buyers have reportedly been seeking discounts of €100 per tonne for the second half of the year, while producers are aiming for a rollover, sources said.
Several sources suggested that parties would agree on a discount of €20-30 per tonne but noted that the gap between spot and contract markets would still be too wide.
Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €631.00 per tonne on Friday, down by €0.13 per tonne from €631.13 per tonne the day before
The index was up by €1.12 per tonne week on week but down by €1.75 per tonne month on month.
In Southern Europe, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Italy at €624.10 per tonne on Friday, up by €0.35 per tonne from €623.75 per tonne the day before.
But the index was down by €0.90 per tonne week on week and by €6.53 per tonne month on month.
Italian buyers estimated achievable prices for domestic HRC at €630-640 per tonne delivered (€620-630 per tonne ex-works).
Latest offers from a domestic mill for July/August-delivery coil were heard at €640-650 per tonne delivered, but sources noted that sales were done with discounts, “since all producers in Europe were struggling to fill order books,” a source told Fastmarkets.
For September-delivery HRC, buyers also expect prices to increase; however, slow demand from the end-user side was casting a shadow on a potential price rebound.
The market for imported coil was quiet, but sources expect to hear higher offers from some suppliers due to safeguards.
“We will see the effects of quotas on import prices of around €20 [per tonne], from certain countries,” a source in the European market said.
Published by: Julia Bolotova
