Despite the summer holiday period coming to an end, there have been few signs yet of the traditional rebound in trading and prices, they added, with European mills keeping quiet and providing no firm offers to the market.
“Mills are being very cautious,” a buyer in Germany said. “They do need to increase prices to [improve their] margins, but it’s clear the market is too weak for a price recovery. It’s very much a case-by-case approach.”
Buyers have also stayed on the sidelines, although some sources said they were likely to resume purchasing when the prices went a bit lower.
Bookings were reported at €580-590 ($648-659) per tonne ex-works in Northern Europe, for October-delivery HRC, with estimates of the tradable value put at about €590-600 per tonne ex-works by sellers and buyers.
One supplier was still hoping to achieve €620 per tonne ex-works, Fastmarkets understands, but most buyers said that price was “unworkable.”
“Oversupply remains a key drag [on HRC prices],” a mill source in the region said. “Mills are fighting for orders, but some suppliers drop their prices too easily [if they receive] a decent bid.”
Fastmarkets calculated its daily steel hot-rolled coil index, domestic, exw Northern Europe, at €597.50 ($667.59) per tonne on August 27, down by €4.33 per tonne from the previous calculation of €601.83 on August 23.
Fastmarkets’ daily HRC indices were not published on Monday due to a public holiday in the UK.
The Northern Europe index was down by €14.58 per tonne week on week and by €31.17 per tonne month on month.
Sources said that recent restrictions on imports of flat steel – including a safeguarding review, and an anti-dumping (AD) investigation into HRC from Egypt, India, Japan and Vietnam – had provided only limited support for domestic markets.
“Recent import restrictions have only slowed the pace of [the fall in domestic HRC prices]. But it’s no game-changer for now,” a buyer in Italy said.
Market sources said that oversupply and subdued demand from the key end-user sectors remained the principal factors acting to drag down domestic HRC prices.
But the recent price drops in China have been a disturbing factor for global markets, “spreading weak sentiment,” market sources said.
“Chinese prices tumbled in August and FOB prices [for HRC] fell to a four-year low before regaining some ground this week,” a trader source in Europe said on Tuesday.
Sources in Italy, meanwhile, said that China-origin HRC prices were competitive for European buyers – even taking into account the EU’s anti-dumping measures.
“With the AD duty, China-origin coil is being offered to Italy at €540-550 per tonne CFR. Some suppliers have even [asked for] €520 per tonne CFR,” a second buyer in Italy said. “No deals have been sealed yet, but European buyers are starting to consider purchasing from China again.”
The EU imposed definitive anti-dumping and countervailing duties of 18.10-35.90% on HRC imports from China in April 2017. And in June 2023, it extended these duties for five more years.
Fastmarkets’ daily steel hot-rolled coil index, domestic, exw Italy, was calculated at €595.00 per tonne on Tuesday, down by €5.00 per tonne from the previous calculation of €600.00 per tonne on Friday.
The index was down by €12.50 per tonne week on week, and by €25.00 per tonne month on month.
The Italian market has just reopened after its traditional summer break, although a key local supplier had yet to announce its new offer prices for October-delivery HRC.
But buyer sources estimated that the current workable price was €590-600 per tonne ex-works.
Late-October shipment HRC from South Korea was on offer to Italy at €590 per tonne CFR, Fastmarkets understands, but sources said that buyer price ideas for overseas coil were unlikely to be higher than €540 per tonne CFR.
Published by: Julia Bolotova
