European HRC prices don’t rise despite mills’ efforts, although cheapest options vanish

Domestic prices for hot-rolled coil in Europe did not move up Oct. 19 despite mills’ attempts to increase offers by around Eur10-20/mt earlier this week.

The lowest prices that had been available earlier in October have disappeared from the market, sources said.

“The mills cannot really maintain prices below Eur600/mt ex-works as production costs are high,” a South European service center said. “As for import, there are few offers just below Eur600/mt CIF South Europe, and they are uncompetitive. It also seems that safeguard quotas will not be filled for the first quarter, so buyers will have to buy from local suppliers.”

Lack of competitive import offers, combined with production cuts in Europe, have been supporting domestic coil prices.

Germany’s ArcelorMittal temporarily idled blast furnaces No. 2 and No. 3 at its Bremen site Oct. 1. ArcelorMittal has also shut blast furnace A at its steel plant in Ghent, Belgium, and was planning to close a furnace at its Fos-sur-Mer site in France. Blast furnaces at the Salzgitter plant in Germany and Tata Steel in the Netherlands have also remained idled for maintenance.

Those factors, however, have not fully offset negative effects from weak demand. Trading activity has remained limited from both end-users and distributors.

“Neither mills nor traders see moves in the market,” a German service center source said. “Therefore, I do not see possibility of increase. Still, the mills are looking for every single ton to book and still are ready to give discounts for reasonable quantity. In my opinion, mills are now collecting orders if there are any, may schedule volumes for the first quarter and half 2024 in order to fill up their production as much as possible.”

Some market sources, however, said buyers have started to slowly return to the market, although the volumes remained below normal for this time of the year.

“Order books of big mills are not as bad and stocks of distributors are not as high as some market participants claim, so some restocking should start soon, and prices are unlikely to move down,” a Northwest European distributor said.

Platts assessed domestic prices for hot-rolled coil in Northwest Europe down by Eur5/mt day on day at Eur605/mt ex-works Ruhr Oct. 19.

Tradable values have been heard at Eur590-620/mt ex-works Ruhr, with the majority of data reported at Eur600-610/mt ex-work Ruhr.

Platts assessed domestic prices for hot-rolled coil in South Europe unchanged day on day at Eur600/mt ex-works Italy Oct. 19.

Tradable values have been reported at Eur600/mt ex-works Italy. Some sources also reported achievable prices at Eur580-590/mt ex-works Italy, but the information was not widely confirmed in the market.

Author Maria Tanatar

Platts is part of S&P Global Commodity Insights.