European HRC prices edge higher, but still below mill target levels

European hot-rolled coil prices edged higher on Friday October 11, supported by an apparent pick-up in buying, but continuing slow consumption raises questions over the sustainability of the uptrend, sources told Fastmarkets.
Fastmarkets calculated its daily steel HRC index, domestic, exw Northern Europe at €549.58 ($600.87) per tonne on Friday, up by €2.41 per tonne from €547.17 per tonne the previous day.

The index was up by €8.75 per tonne week on week, but down by €27.92 per tonne month on month.

In Northern Europe, offer prices for November-December-delivery coil were reported at €560-590 per tonne ex-works on Friday.

And for larger tonnages, discounts of €10-15 per tonne were possible, sources said.

Achievable values were estimated by most buyers at €540-550 per tonne ex-works.

One low-tonnage transaction for Italy-origin HRC was reported to Germany at €580 per tonne delivered.

Apparent demand has started showing signs of improvement since last week and supplier sources said inquiries from buyers had increased through the week to Friday.

“Buyers have realised that the lowest prices are gone and have started looking for [HRC]. Trading has not exploded and volumes [of HRC] are still quite limited, but it looks like we’re past the lowest point,” a mill source told Fastmarkets.

Sources were also not ruling out a potential shortage of HRC in the first quarter of next year, due to lower import bookings.

“New import [HRC] bookings are very low. Too many risks are involved [for instance, anti-dumping investigation and reviewed safeguards], plus prices for overseas coil are totally uncompetitive, so we might be missing some [import] volumes next year,” a buyer source in Germany said.

“In this quarter [October-December 2024], we are still clearing import tonnages that are in the pipeline, but new bookings [of imported HRC] are very scarce,” the source added.

November-shipment coil from Asia was on offer to Europe at around €550-560 per tonne CFR to Antwerp, while HRC from Turkey was offered at €580-590 per tonne CFR, including anti-dumping duty.

None of the offers were considered workable by European buyers due to the small gap to domestic European prices, the longer lead times for imports and all the risks related to trade restrictions in the EU.

In Southern Europe, meanwhile, Fastmarkets’ daily steel HRC index, domestic, exw Italy was calculated at €545.00 per tonne on Friday, up by €5.00 per tonne from €540.00 per tonne the previous day,

The Italian index was up by €10.00 per tonne week on week, but down by €26.25 per tonne month on month.

Sources reported an offer from one local supplier at €580 per tonne delivered (€570 per tonne ex-works).

But buyers estimated the tradable level at no more than €540-550 per tonne ex-works.

“The market is still assessing the recent [push for HRC] price increases. But the lowest prices are gone for sure,” a buyer source said. “However, for steel service centers, stock liquidity remains a priority and in the secondary market there are still very aggressive sales.”

Notably, 4 mm S235 grade HR sheet was still trading around €620-630 per tonne CPT and, from the point of view of steel service centers, an increase of up to €50 per tonne to €670-680 per tonne CPT is “a must” to recover margins, the source added.

Published by: Julia Bolotova

fastmarkets.com