European HRC market lacks clear direction; ‘wait-and-see’ sentiment prevails

European hot-rolled coil prices lacked clear direction on Monday October 7, with most market participants waiting to see how the flat steel market develops, sources have told Fastmarkets.

Last week, a leading European steelmaker increased its offer price for November-delivery HRC to €590 ($647) per tonne ex-works or delivered, depending on the region, Fastmarkets reported.

On Monday, however, mills in Germany had not announced new higher offers, Fastmarkets understands.

“We are expecting some German mills to come back in the market with new prices this week,” a trader source based in Germany told Fastmarkets.

Some European producers and buyers are waiting for the Chinese Golden Week holiday (October 1-7) to come to an end before predicting the price developments in the global flat steel market, according to sources.

As a result, trading remained quiet on Monday.

One mill in Northern Europe was heard offering HRC at €550-560 per tonne ex-works, which was €20-25 per tonne higher than its previous offer, a buyer source told Fastmarkets.

According to the buyer, the previous offer levels could also be available for buyers, however.

Sources indicated the workable market level for HRC in Northern Europe at €530-550 per tonne ex-works.

A second buyer source told Fastmarkets that for larger tonnages even lower prices of €520-530 per tonne ex-works could be achieved.

Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €538.08 per tonne on Monday, down by €2.75 per tonne from €540.83 per tonne on October 4.

The index was down by €3.59 per tonne week on week and by €42.67 per tonne month on month.

In Southern Europe, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €540.00 per tonne on Monday, up by €5.00 per tonne from €535.00 per tonne on October 4.

The Italian index was up by just €1.00 per tonne week on week and down by €40.24 per tonne month on month.

Fastmarkets sources estimated the workable market level for HRC in Italy at €530-550 per tonne ex-works.

Some customers in Italy have indicated that they could accept a price level of €550 per tonne ex-works, but suppliers in Italy were asking for even higher prices, according to a third buyer source.

Regarding imports, trading also remained muted due to the Golden Week holiday in China. Most Asian suppliers have withdrawn their offers and are expected to return with new higher levels later this week.

Published by: Darina Kahramanova