European hot-rolled coil steel prices were slightly higher on Tuesday, with import constraints seen as a major driver behind the uptrend, sources told Fastmarkets on March 10.
Integrated HRC producers in Northern Europe have mainly been offering May delivery coil, Fastmarkets understands. And, amid rising HRC prices, suppliers have started to be more cautious about volume allocations, aiming to avoid over-committing to tonnages and potentially missing out on further price increases, Fastmarkets understands.
In Germany, offers were reported at a base price of €730 ($844) per tonne delivered (equivalent to about €715 per tonne ex-works) from one supplier and at €720 per tonne delivered (around €705 per tonne ex-works) from another.
A third mill was heard offering HRC at €700 per tonne ex-works, in line with recent sales. However, one source told Fastmarkets that the producer had withdrawn the offers on Monday.
In the Benelux region, one local mill was also offering HRC at €700 per tonne ex-works, Fastmarkets understands.
Indications of achievable prices from buyers in the region were heard at €700-710 per tonne ex-works, however, steel-service centers (SSCs) indicated that there were issues with passing on their higher costs to downstream users.
“Our customers need [the HRC price to be] €650-660 [per tonne ex-works]. That’s based on offers for [HR] sheet from people who have cheap material [in stock that] they are now selling, a service center source in the region told Fastmarkets.
“The problem now is that my clients tell me they cannot buy new coil at the current market prices,” the source added.
And a trader source in the region said: “Uncertainty regarding energy has paralyzed everyone. The moves are so sharp; all you can do is watch and see where the dust settles.”
A second trader source said the situation in the Middle East – following the US/Israel attacks on Iran and its wide-ranging response – meant that “trading seems presently to be more dominated by speculation and not driven by demand.”
In the secondary market, meanwhile, 4 mm HR sheet was heard changing hands at €740-750 per tonne CPT in Germany, with new offers heard at €800 per tonne CPT – reflecting the higher feedstock costs. The newer have not been accepted by the market so far, however.
Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe was calculated at €704.38 per tonne on March 10, up by €2.92 per tonne from €701.46 on Monday.
The index was up by €10.07 per tonne week on week and by €50.21 per tonne month on month.
In Southern Europe, meanwhile, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €687.50 per tonne ex-works on March 10, up by €2.50 per tonne from €685.00 per tonne on March 9.
The index was also up by €7.50 per tonne week on week and by €42.50 per tonne month on month.
Italian steelmakers were maintaining target offers for May delivery HRC at around €700 per tonne ex-works, Fastmarkets understands. One source, however reported an offer at a base price of €700 per tonne delivered, which nets back to around €685 per tonne ex-works.
“We are offering HRC at around €700 per tonne ex-works [because] there are currently no strong grounds to push for higher prices,” a supplier source told Fastmarkets.
Market participants estimated achievable price was around €680-690 per tonne ex-works on Tuesday.
Import activity remained subdued, with market participants reporting only limited fresh offers.
The slowdown was largely attributed to uncertainty surrounding the EU’s revised safeguard measures and the allocation of country-specific quotas. In addition, the unclear cost implications of the Carbon Border Adjustment Mechanism (CBAM) have encouraged buyers to adopt a more cautious approach.
Logistics have also complicated the situation. Due to security risks in the Middle East, many vessels transporting material from Asia to Europe have been forced to reroute via the Cape of Good Hope in South Africa, extending transit times by around two weeks and tightening prompt supplies.
“This week has been very quiet so far in terms on new [HRC] offers,” a trader source in Italy said.
On Tuesday, HRC from Algeria was on offer to Italy at €620 per tonne CFR, sources said.
