The uptrend in the European steel hot-rolled coil market continued on Wednesday January 28, with suppliers insisting on higher offers and buyers gradually accepting the increases, sources told Fastmarkets.
Sources said the rising prices were being driven by fears of a shortage of imports at higher costs due to EU safeguard measures and the introduction of the Carbon Border Adjustment Mechanism (CBAM).
In Northern Europe, integrated mills still had some limited availability of March-delivery coil, while some suppliers claimed to be already completely sold out of first-quarter volumes.
Offers for April delivery were hovering around €670-680 per tonne ex-works, depending on supplier, sources said.
Buyers, however, estimated achievable prices at €640-650 per tonne ex-works, with the top end of that range most likely, in line with recent transactions.
“[HRC] prices are slowly climbing – not driven by demand but, rather, by fear of higher import costs due to CBAM and safeguards,” a buyer in Germany told Fastmarkets.
Despite buyer resistance to higher new offer prices so far, the mood remains largely optimistic, buoyed by the regulations limiting new imports.
“At the beginning of January, there was a lot of resistance to the uptrend, but now we are seeing more acceptance on the buyer side. Prices [for HRC] are moving up slowly, but steadily,” a second buyer said.
Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Northern Europe, was €655 ($781.21) per tonne on January 28, up by €5.50 per tonne from €649.50 per tonne on January 27.
The index was up by €12.41 per tonne week on week and by €27.50 per tonne month on month.
Some limited availability remained for March-delivery coil in Italy.
“Prices are gradually improving,” a supplier source said. “Earlier we were testing the market with higher numbers, but now [those are] our firm offers.
“Our order book is strong, which is why we can wait until the higher offers are accepted,” the source added.
Offers were heard at €650-660 per tonne ex-works, while estimates of the workable level were about €630-635 per tonne ex-works.
Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €642.50 per tonne on Wednesday, increasing only by €4.54 per tonne from €637.96 per tonne a day earlier.
The index was up by €7.50 per tonne week on week and by €19.38 per tonne month on month.
