European prices for steel hot-rolled coil increased slightly on Monday June 8, but market activity remained slow in both Northern Europe and Italy, with sentiment weighed down by upcoming safeguard measures set to come into force on July 1, sources told Fastmarkets.
In Northern Europe, sources reported that weak demand, under-utilized competition and low consumption continued to weigh on market sentiment.
One buyer reported an offer at €700-705 ($806-812) per tonne ex-works, with workable prices indicated at €680-685 per tonne ex-works on Monday.
A second buyer source reported an indication for achievable prices at €660-680 per tonne ex-works for July-August delivery, which was given zero tonnage due to a lack of selling interest at that level.
No significant trading was reported during the day.
“Everyone is waiting for the [country-specific allocations under new import] quota clearance, so activity would pick up from July 1,” the first buyer source told Fastmarkets, adding that current demand was “pretty poor.”
The new safeguard measures include lower steel import quotas to the EU and higher out-of-quota duties, aimed at shielding the local steel industry from global overcapacity and unfair trade practices.
An offer at €700 per tonne ex-works and indications at €670-700 per tonne ex-works reported on Friday June 5 were carried over to Monday’s index due to a lack of fresh input from market participants.
Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe was calculated at €692.00 ($796.99) per tonne on Monday, up by €0.33 per tonne from €691.67 per tonne on Friday.
The index was up by €2.00 per tonne week on week and up by €2.42 per tonne month on month.
In Italy, one buyer source reported a fresh offer for HRC at €700-710 per tonne delivered (€685-695 per tonne ex-works) announced on Monday morning, while indications for achievable prices were heard at €665-680 per tonne ex-works, in line with the latest transactions reported on Friday.
“Generally, very little is happening due to the wait-and-see mood, linked to the lack of information regarding the new safeguard [measures],” the buyer said.
A second buyer said offers were at €655-670 per tonne ex-works for end-August delivery, which were given zero tonnage due to the longer delivery window, which exceeds Fastmarkets’ methodology period of up to six weeks.
“[There is] still no real demand and stockholders are very skeptical placing orders now,” the second buyer said, adding that high steel slab feedstock costs were the biggest problem for re-rollers and were expected to “limit discounts on the strip side.”
Meanwhile, a third buyer in Italy said they had heard the lower HRC offers at €655-670 quoted by the second buyer, but was not sure whether these levels were “completely true.”
Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy was calculated at €680.83 per tonne on Monday, up by €1.25 per tonne from €679.58 per tonne on Friday.
The index was up by €3.33 per tonne week on week, but down by €5.52 per tonne month on month.
The latest import activity in Southern Europe was reported on Friday, when Indian HRC was heard sold at $650-690 per tonne CIF, with the higher end linked to deliveries to Spain, according to a mill source.
