Demand from the main steel-consuming sectors remained low, with poor prospects for the near term, Fastmarkets understands.
The oversupply of HRC in Europe continued to put additional downward pressure on prices, with trading in the region remaining limited as a result.
Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe at €545.63 ($609.45) per tonne on Thursday, down by €4.25 per tonne from €549.88 per tonne the previous day.
The index was down by €13.98 per tonne week on week and by €56.20 per tonne month on month.
Mills in Northern Europe were heard offering HRC at €570-580 per tonne ex-works, while buyers estimated the workable market level lower at €530-560 per tonne ex-works.
In Southern Europe, Fastmarkets’ daily steel HRC index, domestic, exw Italy was €542.50 per tonne on Thursday, down by €1.88 per tonne from €544.38 per tonne the previous day.
The Italian index was down by €15.00 per tonne week on week and by €57.50 per tonne month on month.
One Italian supplier was heard offering HRC at €560 per tonne delivered, which nets back to €550 per tonne ex-works.
Buyers estimated the tradeable market level at €530-550 per tonne ex-works, depending on the customer and traded tonnage.
A buyer source based in Italy told Fastmarkets that prices for HRC were close to the cost of production and would probably stabilize in the coming weeks.
“There is no more room [for prices] to go down, but there is not even one reason [for prices] to go up,” the source said.
Asia-origin HRC was heard offered to Italy at €525-535 per tonne CFR, for shipment at the end of October or November.
Buyers’ interest in the material remained low however, due to the trade safeguard measures, the European anti-dumping investigation against HRC from several origins and the small gap to domestic prices, Fastmarkets understands.
Green Steel
The spot market for green steel in Europe was also very quiet, with no new transactions reported during the week to Thursday.
Major suppliers in Europe maintained offers for steel with Scope 1, 2 and upstream Scope 3 emissions below 0.8 tonnes of carbon dioxide (CO2) per tonne of steel at €200-350 per tonne.
Estimates of tradeable values for the same material came in at €80-150 per tonne during the assessment week.
A mill source pointed out that for steel with CO2 emissions content below 500 kg per tonne of steel, “premiums below €200 per tonne would not be possible.”
Fastmarkets’ weekly assessment of the green steel domestic, flat-rolled, differential to HRC index, exw Northern Europe was stable at €100-200 per tonne on Thursday.
Sources suggested that low liquidity in the green steel market was connected to the global downturn in the European steel sector and slow consumption.
Once again, sources also said that the lack of a common standard for the industry remained an issue.
“We still have no formal definition for green steel; there is no clarity on how downstream Scope 3 emission should be calculated,” a buyer source in Germany told Fastmarkets.
“We absolutely need an industry definition of what steel is green. It doesn’t exist today. We are all talking about same thing, but slightly differently,” a mill source in Northern Europe said.
Buyer and seller sources agreed that the green steel definition needs to specify how many tonnes of CO2 emissions are embedded in one tonne of steel.
Fastmarkets methodology definition for green steel in Europe is the following:
“Steel produced with scope 1,2 & 3 emissions of maximum 0.8 tonnes of CO2 per tonne of steel”
Published by: Julia Bolotova, Darina Kahramanova
