Sources have reported improved apparent demand for steel coil, especially in Northern Europe, in the past few weeks.
“Inquiries [for HRC] have picked up lately,” a mill sources in Northern Europe said. “We don’t sell big volumes, but there are 50 tonnes here, 500 tonnes there, so business keeps running and our order books are good.”
A distributor in Germany said that buyers were still cautious and unwilling to book big volumes for stock.
“[The buyers] expect more clarity on safeguards but, overall, market activity is back from the dead we saw in January,” the distributor said.
First-tier suppliers in Northern Europe claimed to be largely sold out in terms of HRC with April lead times.
Official offers were reported at €640-660 ($691-713) per tonne ex-works (or delivered) in Germany and the Benelux area.
Buyer estimates of the tradable values were reported at €620-630 per tonne ex-works. However, most sources agreed, that booking HRC at €620 per tonne ex-works “was almost impossible, especially for minor tonnages.”
Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €631.38 per tonne on Friday, up by €0.44 per tonne from €630.94 per tonne on Thursday.
The Northern European index was up by €4.55 per tonne week on week and by €32.21 per tonne month on month.
Additionally, production interruptions at German steelmaker Salzgitter, after a fire in a hot-strip mill on February 28, also reduced the availability of HRC in the region, supporting bullish sentiment.
Fastmarkets’s sources estimated output losses as a result of the fire to be around 80,000 tonnes of HRC.
The company did not respond to Fastmarkets request for comment about production losses by the time of publication.
And in the week to Friday, there were no updates on the EU safeguards review, which was started in December and was expected to conclude by March 31, with any adjustments expected to come into force the following month.
Sources told Fastmarkets they had expected to see a World Trade Organization notification regarding the new measures in the week ending
February 28, but this did not happen because of “some last-moment changes.”
In Southern Europe, meanwhile, Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €620.00 per tonne on Friday, unchanged day on day.
The index was up by €7.50 per tonne week on week and by €27.50 per tonne month on month.
Sources told Fastmarkets that Italian mills were aiming for €640-660 per tonne delivered (€630-650 per tonne ex-works) for April-May delivery HRC.
This level has yet to be sealed in deals, however, and buyers said that achievable prices were closer to €610-620 per tonne ex-works.
“Buyers are being cautious with bookings because they want to see more clarity on safeguards,” a buyer in Italy said. “There are different rumors about HRC quotas, which could be cut by 30% or 50%, with steel semis being included. But nothing is clear until we see the document,” a buyer in Italy said.
In the secondary market, 4 mm HR sheet was on offer at €700 per tonne CPT, sources said, compared with €680-700 per tonne CPT in late February. But sources said sales were “not booming.”
The European market for imported HRC, meanwhile, has been largely quiet recently due to the looming safeguard measures review.
Most overseas suppliers were offering HRC to Europe with lead times in the second quarter, making imports increasingly risky if new safeguard measures come into effect in April.
From Asia, offers were reported at €550-570 per tonne CFR to Italy.
HRC from Turkey was on offer to Italy at €590-600 per tonne CFR, including the anti-dumping duty, sources told Fastmarkets. Several sources said that for big volumes it was possible to achieve €570-580 per tonne CFR.
One source reported a booking of Turkish material at €560-570 per tonne CFR to Italy, including the duty, but this could not be confirmed by the time of publication.
