European HRC market quiet amid summer slowdown; expectations mixed

The European steel hot-rolled coil market remains in holiday mode, with prices broadly flat amid non-existent trading, sources told Fastmarkets on Tuesday August 6.

The summer holiday season was limiting trade across the European HRC market; firm offers were rare, and sources pointed out that suppliers preferred a “case-by-case” approach.

Buyer sources estimated the workable market level to be at €600-620 ($657-679) per tonne ex-works.

Some sources suggested that €590 per tonne ex-works was achievable for larger volumes, but this could not be confirmed with suppliers.

The latest offers for September-delivery HRC were heard at €620-650 per tonne ex-works in Northern Europe, while some mills were aiming for €660 per tonne ex-works for October-delivery cargoes.

As a result, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Northern Europe at €620.00 per tonne on Tuesday, down by €2.08 per tonne from €622.08 per tonne on Monday.

The index was down by €5.00 per tonne week on week and by €11.00 per tonne month on month.

Meanwhile, the post-summer price direction was still unclear.

On the one hand, sources suggested that the inflow of cheap imports into the EU will be limited by new safeguards, as well as looming anti-dumping investigations against certain origins; and that, along with restocking, would help European mills to achieve higher prices.

“We still expect [HRC] prices to move up from the end of August or beginning of September as buyers will buy more domestically,” a buyer in the Benelux area said.

At the same time, sources said that real consumption remains weak, and is unlikely to recover until the end of the year – a view that was echoed by European steel industry association Eurofer in its quarterly outlook published at the end of July.

“Without consumption rebound we cannot speak about any sustainable price recovery,” a second buyer said.

In Southern Europe, Fastmarkets calculated its daily steel hot-rolled coil index domestic, exw Italy at €620.00 per tonne on Tuesday, unchanged from a day earlier.

The index was down by €1.25 per tonne week on week and down by €4.10 per tonne month on month.

The Italian market was silent on Tuesday. Local suppliers have started summer maintenance work and were expected to come back to the market with fresh offers at the end of August, Fastmarkets heard.

Buyer sources estimated the workable market level to be at €600-620 per tonne ex-works.

In terms of imports, sources reported an offer from one Japanese supplier at €580 per tonne CFR to Southern Europe, for October-shipment HRC.

From Turkish mills, September-October shipment HRC was offered at €570-590 per tonne CFR, including the duty.

From Vietnam, offers were reported at €560-570 per tonne CFR. For large volumes, offers were heard at €540 per tonne CFR to some regions.

Darina Kahramanova in Sofia contributed to this report.

Published by: Julia Bolotova

fastmarkets.com